The graph show the market for paper Draw a shape that repres

The graph show the market for paper. Draw a shape that represents the consumer surplus from paper. Label it CS. Draw a shape that represents the producer surplus from paper. Label it PS. Consumer surplus from paper equals $ Producer surplus from paper equals $ The market for paper is efficient because

Solution

1.Consumer\'s Surplus = ($8 - $3) * 40 / 2 = $100

2. Producer\'s Surplus = ($3 - $1) * 40 / 2 = $40

3. At the market equilibrium marginal benefit equals marginal cost and total surplus is maximized.