Figure 9.2
-Refer to Figure 9.2. At price 0H and quantity Q1, producer surplus is the area
A) 0ABQ1.
B) 0EDQ1.
C) AHB.
D) 0FGQ1.
E) none of the above

Question

Figure 9.2
-Refer to Figure 9.2. At price 0H and quantity Q1, producer surplus is the area
A) 0ABQ1. 
B) 0EDQ1. 
C) AHB. 
D) 0FGQ1. 
E) none of the above

Quizplus · Accepted Answer

Producer surplus is defined as the difference between the price that a producer receives and the minimum price that they would be willing to sell their product for. In this case, at price 0H and quantity Q1, the minimum price that the producer would be willing to sell their product for is represented by point B on the supply curve. Therefore, the producer surplus is the area AHB.

Figure 9.2 -Refer to Figure 9.2. at Price 0H and Quantity Q1