Total Surplus measured in cream, If the market ceased to exist, would be [...]
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the monetary value of the loss to society.
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Open it If price measures dollars per unit, and quantity measures units per month, then the measure of total surplus is dollars per month.
Total Surplus, If the market ceased to exist, would be the monetary value of the loss to society.
Original toplevel document
3.11. Total Surplus—Total Value minus Total Variable Cost equilibrium and total surplus, represented as the area of the shaded triangle. The area of that triangle is the difference between the trapezoid of total value to society’s buyers and the trapezoid of total resource cost to society’s sellers. <span>If price measures dollars (or euros) per unit, and quantity measures units per month, then the measure of total surplus is dollars (euros) per month. It is the “bargain” that buyers and sellers together experience when they voluntarily trade the good in a market. If the market ceased to exist, that would be the monetary value of the loss to society.
Exhibit 14. Total Surplus as the Area beneath the Demand Curve and above the Supply Curve
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