Ronnie operates a lawn-care service.On each day,the cost of mowing the first lawn is $10,the cost of mowing the second lawn is $12,and the cost of mowing the third lawn is $15.His producer surplus on the first three lawns of the day is $53.If Ronnie charges all customers the same price for lawn mowing,that price is
A) $25.
B) $30.
C) $36.
D) $45.

Question

Quizplus · Accepted Answer

The producer surplus is the difference between the price Ronnie charges and the cost of mowing the lawns. Let's call the price Ronnie charges P.

For the first lawn, Ronnie's producer surplus is P - $10. 
For the second lawn, Ronnie's producer surplus is P - $12. 
For the third lawn, Ronnie's producer surplus is P - $15.

So Ronnie's total producer surplus for the first three lawns is (P - $10) + (P - $12) + (P - $15) = 3P - $37.

We know that this is equal to $53, so:

3P - $37 = $53

3P = $90

P = $30

Therefore, Ronnie charges $30 per lawn mowing.

Ronnie Operates a Lawn-Care Service