Key Diagrams - Consumer and Producer Surplus

This short revision video takes students through the basics of consumer and producer surplus and highlights key topics where the concepts might be usefully applied in analysis and evaluation.

Some key topics to use consumer & producer surplus:

• Economic welfare effects of increased contestability
• Welfare impact of price discrimination in a monopoly
• Impact on price collusion within an oligopoly
• Impact of indirect taxes on welfare
• Impact of government subsidies on welfare
• Effects of businesses achieving economies of scale
• Welfare effects of international trade
• Welfare impact of protectionist measures (tariffs, quotas)