Market demand is given as Q_D= 150 - 0.5P.Market supply is given as Q_S= 2P.In a perfectly competitive equilibrium,what will be the value of producer surplus

Question

Quizplus · Accepted Answer

To find the producer surplus, first find the equilibrium price and quantity by setting QD = QS: 150 - 0.5P = 2P. Solving gives P = 60 and Q = 120. Producer surplus is the area above the supply curve and below the equilibrium price, calculated as 0.5 * base * height = 0.5 * 120 * 60 = $3600.

Market Demand Is Given as QD = 150 - 0

Market Demand Is Given as Q_D= 150 - 0