Identifying surpluses and expenditure in supply-demand diagram

Steps:

• Define consumer surplus as triangle above equilibrium price, below demand curve, up to equilibrium quantity.
• Define producer surplus as triangle below equilibrium price, above supply curve, up to equilibrium quantity.
• Define total consumer expenditure as rectangle from origin to equilibrium price and quantity.
• Match areas to labels: RST fits consumer surplus triangle, UST fits producer surplus triangle, STGO fits expenditure rectangle.

Why B is correct:

• B aligns with definitions: RST is consumer surplus (demand-price area), UST is producer surplus (price-supply area), STGO is expenditure (P*Q rectangle).

Why the others are wrong:

• A: TUG includes supply curve area incorrectly for producer surplus; STEU overextends expenditure.
• C: RTEU wrongly includes below-price area for consumer surplus; TEF and RFU mislabel surpluses and expenditure.

Final answer: B