Use the table below to answer the following questions.
Table 5.2.1
-Table 5.2.1 gives information on marginal cost for the XYZ firm.If XYZ sells the first unit at a price of $6,what is the producer surplus on that unit?
A)$4
B)$6
C)$9
D)$12
E)$7

Question

Use the table below to answer the following questions.
Table 5.2.1 
-Table 5.2.1 gives information on marginal cost for the XYZ firm.If XYZ sells the first unit at a price of $6,what is the producer surplus on that unit?
A)$4 
B)$6 
C)$9 
D)$12 
E)$7

Quizplus · Accepted Answer

Producer surplus is the difference between the price at which a producer sells a product and the minimum price they are willing to accept for it. If the marginal cost of the first unit is $2 (not given explicitly but implied as necessary for the answer) and it sells for $6, the producer surplus is $6 - $2 = $4.

Use the Table Below to Answer the Following Questions