producer surplur is equal consumer surplus at equilibrium popint.explain
Your statement is hard to explain because you have so many typographic errors in it.
ya now i hav posted again .can u answer me now?its very essential tomorrowis my exam.
Huh?
Producer surplus is represented by the area above supply and below price. Consumer surplus in represented by the area below demand and above price. Under what conditions can this be true?
Producer surplus is a measure of the benefit that producers receive from selling goods or services in the market. It is defined as the difference between the price that producers are willing to sell a good for and the price at which they actually sell it.
Consumer surplus, on the other hand, is a measure of the benefit that consumers receive from purchasing goods or services in the market. It is defined as the difference between the price that consumers are willing to pay for a good and the price at which they actually pay.
At the equilibrium point in a market, the quantity demanded by consumers is equal to the quantity supplied by producers. This means that the price at which consumers are willing to buy and the price at which producers are willing to sell are the same.
When the market is in equilibrium, the producer surplus and consumer surplus are also equal. This is because the price at equilibrium captures the maximum benefit for both producers and consumers. Any deviation from the equilibrium price would result in either a surplus or shortage in the market, reducing the benefit for one group while benefiting the other.
To calculate producer surplus and consumer surplus, you would need to know the supply and demand functions, as well as the equilibrium price and quantity. By calculating the area under the supply curve and above the equilibrium price, you can find the producer surplus. Similarly, by calculating the area above the demand curve and below the equilibrium price, you can find the consumer surplus.