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Producer Surplus
Calculating Total Producer Surplus Using Integration
When treating quantity as a continuous variable, total producer surplus can be calculated with integration for any given price and quantity sold , irrespective of whether it's a market equilibrium point. The surplus is the integral of the price minus the marginal cost () from zero to : Total Producer Surplus = . This is equivalent to the formula , where represents the firm's fixed costs. This expression effectively calculates total revenue () minus the total variable costs ().
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Social Science
Empirical Science
Science
Economy
CORE Econ
The Economy 1.0 @ CORE Econ
Ch.1 The Capitalist Revolution - The Economy 1.0 @ CORE Econ
Economics
Introduction to Microeconomics Course
Related
Visualizing Total Producer Surplus in the Bread Market
Elasticity of Supply
Visualization of Consumer and Producer Surplus at a Non-Equilibrium Point (Figure E8.5)
Calculating an Individual's Producer Surplus
Calculating Total Producer Surplus Using Integration
Relationship Between Producer Surplus, Profit, and Fixed Costs
Learn After
Condition for Maximizing Producer Surplus: Price Equals Marginal Cost