Figure 9-9
-Refer to Figure 9-9.Producer surplus in this market after trade is
A)A.
B)A + B.
C)B + C + D.
D)C.

Question

Figure 9-9 
-Refer to Figure 9-9.Producer surplus in this market after trade is
A)A. 
B)A + B. 
C)B + C + D. 
D)C.

Quizplus · Accepted Answer

Producer surplus is the area between the supply curve and the market price. After trade, the market price rises to P2, which means that producers receive a higher price than before. The new producer surplus can be calculated as the area B + C + D. A and C are not correct as they do not accurately represent the change in producer surplus after trade.

Figure 9-9 -Refer to Figure 9-9.Producer Surplus in This Market After Trade