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Producer Surplus (labelling PS (reduction in PS, new PS, original PS,…
Producer Surplus
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measures the difference between what producers are willing and able to supply a
good for and the price they actually receive.
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Market Price is £10 and suppliers willing to supply 60 units.
Total Revenue = 60 X £10 = £600.
Producer Surplus = (60 X 10) / 2 = £300
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