Term
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Definition
| the maximum price at which a consumer will buy a good |
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Term
| individual consumer surplus |
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Definition
| the net gain to an indiidual buyer from the purchase of a good. It is equal to the buyer's willingness to pay and the price paid. |
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Term
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Definition
| the sum of the individual consumer surpluses of all the buyers of a good |
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Term
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Definition
| often used to refer to both individual and total consumer surplus |
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Term
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Definition
| a potential seller's cost is the lowest price at which he or she is willing to sell a good |
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Term
| individual producer surplus |
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Definition
| the net gain to a seller from selling a good. It is equal to the difference between the price received and the seller's cost |
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Term
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Definition
| total producer surplus in a market is the sum of the individual producer surpluses of all the sellers of a good. |
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Term
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Definition
| total surplus generated is the total net gain to consumers and producers from trading in the market. IT is the sum of the producer and consumer surplus |
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Term
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Definition
| occurs when a market fails to be efficient |
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