Graph 8-2

-According to Graph 8-2, after the tax is levied, producer surplus is:
A) $375
B) $750
C) $1500
D) $1125

Question

Graph 8-2
 
-According to Graph 8-2, after the tax is levied, producer surplus is:
A) $375 
B) $750 
C) $1500 
D) $1125

Quizplus · Accepted Answer

Producer surplus is the area above the supply curve and below the price line. After the tax is levied, the price line shifts down, reducing the area of producer surplus. The new producer surplus is the area above the new supply curve and below the new price line, which is $375.

Graph 8-2 -According to Graph 8-2, After the Tax Is Levied, Producer