CONSUMER SURPLUS AND PRODUCER SURPLUS

Consumer Surplus:

It is difference between the prices at which he bought the product and he is willing to pay.

Example:

For example you are interested to buy a house in bangalore for Rs.50 lakhs and searched some websites and visited some constructed houses and finally bought a house for Rs. 48 lakhs .

The difference amount Rs.2 lakhs is called consumer surplus

Producer Surplus:

It is difference between the prices at which the producer sol the product and he is willing to sell the producer

Example:

For example you are producer of the laptop and you want to sell the laptop for Rs.35000 and keep that in the market. But you sold the laptop for Rs.40000. The difference between the two prices is Rs.5000 this amount is called the producer surplus