amanda goes to a local café and orders a sandwich. she is willing to pay $10 for it. the price of the sandwich is $4. the cost to the café to produce the sandwich is $1. how much economic surplus does the café receive when amanda purchases the sandwich?

The café’s economic surplus from Amanda’s purchase is $3.

Economic surplus for the producer (the café) in this simple setting is the producer surplus , which is the difference between the price received and the cost of producing the good.

• Price of the sandwich = $4
• Cost to the café = $1

So the café’s surplus = 4−1=34-1=34−1=3, i.e., $3.