Figure 9-12

-Refer to Figure 9-12.Producer surplus before trade is
A) $3,600.
B) $4,600.
C) $5,400.
D) $6,250.

Question

Figure 9-12
 
-Refer to Figure 9-12.Producer surplus before trade is
A) $3,600. 
B) $4,600. 
C) $5,400. 
D) $6,250.

Quizplus · Accepted Answer

The producer surplus before trade is represented by the triangle above the supply curve and below the equilibrium price line. This triangle has a base of 10, a height of 540, and a formula of (1/2) x base x height = (1/2) x 10 x 540 = $2,700. Therefore, the total producer surplus before trade is 2 x $2,700 = $5,400.

Figure 9-12 -Refer to Figure 9-12.Producer Surplus Before Trade Is