Figure 9-4

-Refer to Figure 9-4.What is producer surplus in this market before trade
A)A
B)C + B
C)C
D)C + D + B

Question

Figure 9-4
 
-Refer to Figure 9-4.What is producer surplus in this market before trade
A)A 
B)C + B 
C)C 
D)C + D + B

Quizplus · Accepted Answer

Producer surplus is the area between the supply curve and the equilibrium price line. Before trade, the equilibrium price is at point C, and the supply curve intersects the price axis at point A. Therefore, the producer surplus is the area between the supply curve and the price line between points A and C, which is only represented by the shaded region at point C.

Figure 9-4 -Refer to Figure 9-4.What Is Producer Surplus in This Market