Social Surplus Calculator

Formula

To calculate the Social Surplus ($SS$):

\[ SS = CS + PS \]

Where:

$SS$ is the social surplus ($)
$CS$ is the consumer surplus ($)
$PS$ is the producer surplus ($)

What is Social Surplus?

Social surplus, also known as total welfare or total surplus, is the sum of consumer surplus and producer surplus. It represents the total benefits that consumers and producers receive from participating in a market. Consumer surplus is the difference between what consumers are willing to pay for a good or service and what they actually pay, while producer surplus is the difference between what producers are willing to accept for a good or service and the actual price they receive. Social surplus is used as an indicator of the overall economic welfare and efficiency of a market.

Example Calculation 1

Let's assume the following values:

Consumer Surplus ($CS$) = $500
Producer Surplus ($PS$) = $300

Using the formula:

\[ SS = 500 + 300 = 800 \]

The Social Surplus is $800.

Example Calculation 2

Let's assume the following values:

Consumer Surplus ($CS$) = $700
Producer Surplus ($PS$) = $400

Using the formula:

\[ SS = 700 + 400 = 1100 \]

The Social Surplus is $1100.