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Graph illustrating consumer (red) and producer (blue) surpluses on a supply and demand chart

An economic surplus is when you have more of something in the economy than people demand. There are two types:

Consumers' surplus is the gain by consumers who can buy a product for less than the highest price that they would be willing to pay.

Producers' surplus is the amount got by producers who sell at a market price higher than the least they would be willing to sell for. view more...