Economics

Producer surplus refers to the difference between the lowest price at which a producer was willing to sell a product and the price at which he actually sold it. Simply put, we can say that a producer was willing to sell his product at a lower price but was able to sell it at a higher price in the market. The profit he makes due to this is producer surplus.

For Example

A producer wanted to sell apples for 10 taka per piece but he was able to sell them for 20 taka. So his profit is 10 taka ,this is the producer supply.

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Full meaning of GNP

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Consumer surplus refers to the difference between what a consumer is willing to pay for a product and what he or she actually has to pay.

In simple terms, we can say that a consumer was willing to pay more for a product but was able to buy it for less, which made him some profit, and this is Consumer Surplus.

For Example

Suppose you wanted to buy a shirt for 1000 taka but you were able to buy the shirt for 900 taka, then 100 taka is your consumer surplus.