People Face Trade Offs:
As modern technology advances, one
could argue that society has traded-offs battery life in personal electronics
for a smaller size and weight of the individual device. Trade-off is basically
choosing one thing over another.
Examples:
Some days
ago, I was gone to buy a “Pizza” but after seeing “burger” I decided to buy “burger”
in place of “Pizza”.
Producer Surplus:
Difference between the total amount that consumers are willing
to pay and the total amount that they actually pay.
Few years
ago I went to purchase a Mobile in which the price mentioned was 20,000 and I
was makeup my mind that I will buy that Mobile at the maximum price of 18,000 but
the seller sells the Mobile at 15,000. In which I got 3,000 as Producer Surplus.
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