Producer surplus is the difference between what producers are willing to accept for a good or service and the actual price they receive in the market. It represents the extra benefit producers gain when they sell at a higher price than their minimum acceptable price. This surplus encourages producers to supply more goods, as they can earn additional profit. For example, if a farmer is willing to sell apples for $1 each but sells them for $1.50, the producer surplus is $0.50 per apple. This surplus incentivizes the farmer to continue producing apples, contributing to overall market supply.