The following figure depicts the supply curve of a certain firm.

-Refer to the figure above.If the slope of the supply curve is 1/2,what is the producer surplus at a price of B?

Question

The following figure depicts the supply curve of a certain firm.
 
-Refer to the figure above.If the slope of the supply curve is 1/2,what is the producer surplus at a price of B?

Quizplus · Accepted Answer

To find the producer surplus at point B, we need to find the area below the price B and above the supply curve.

First, we can see that the quantity supplied at point B is 50.

Now, we can find the corresponding cost of producing that quantity by following the supply curve horizontally to the y-axis. The cost is $25.

Therefore, the producer surplus at point B is:

Producer surplus = Price - Cost

Producer surplus = $50 - $25

Producer surplus = $25

So the correct answer is B, $25.

The Following Figure Depicts the Supply Curve of a Certain