ò (demand function) dx –

ò (demand function) dx – (Price × quantity demanded)      − Hence the consumer’s surplus is = units. . . Producer surplus A supply function g ( x ) represents the quantity that can be supplied at a price p . Let p be the market price for the corresponding supply x o . But there can be some producers who are willing to supply the commodity below the market price gain from the fact that the price is p . This gain is XII Std - Business Maths & Stat EM Chapter - - called the producer’s surplus. It is represented in the following diagram. Y O Fig. . PS P X Quantity Price Mathematically, producer’s surplus (PS) can be defined as, PS = (Area of the rectangle OAPB) − (Area below the supply function from to PS = x p – g x dx