Economic Surplus

In general as the price of a good increases, the quantity demanded of that good decreases.

Consumer surplus is the difference between the maximum price a consumer is willing to pay and the actual price they do pay.

Consumer surplus decreases when price is set above the equilibrium price, but increases to a certain point when price is below the equilibrium price.

Market power is a measure of a firm's economic strength that affects its pricing and supply decisions.

Producer surplus is the difference between the amount producers get for selling a good and the amount they want to accept for that good.

Producer surplus is affected by changes in price, the demand and supply curve, and the price elasticity of supply.