Figure 7-3

-Refer to Figure 7-3.Which area represents producer surplus at a price of P₁
A)ACF
B)BCE
C)ABED
D)DEF

Question

Figure 7-3
 
-Refer to Figure 7-3.Which area represents producer surplus at a price of P₁
A)ACF 
B)BCE 
C)ABED 
D)DEF

Quizplus · Accepted Answer

Producer surplus is the difference between the price producers receive for their goods and the minimum price they are willing to accept. At a price of P₁, the producer surplus is represented by the area BCE, which is the difference between the market price and the supply curve.

Figure 7-3 -Refer to Figure 7-3.Which Area Represents Producer Surplus at a Producer