Another good concept is consumer surplus and producer surplus, which is the excess value

that somebody gets even though they were willing to pay more, the product was priced the

same for everybody.

I get a lot of joy out of my morning coffee.

Obviously, I've made some money.

If my coffee costs $20, I would pay $20 for my morning coffee.

But Starbucks doesn't know that.

It can't price the coffee at $20 just for me because it's selling the exact same product.

So I'm getting a lot of consumer surplus out of the coffee.

And all businesses generate consumer surplus.

It's a good thing to keep in mind when someone's harping about how evil companies are.

Amazon might be a trillion dollar company, but I would bet you they're generating trillions

of dollars in consumer surplus through convenience and willingness to pay.

There are a lot of people who are willing to pay more than what Amazon charges them for

all their services.