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Relationship Between Economic Rent, Joint Surplus, and Gains from Trade
Voluntary economic interactions are undertaken because participants can obtain an economic rent, which represents the surplus benefit of the transaction. The sum of these individual economic rents for all participants is called the joint surplus. This joint surplus serves as a quantitative measure of the total gains from trade created by the interaction.
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Relationship Between Economic Rent, Joint Surplus, and Gains from Trade
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Learn After
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