Figure 7-13

-Refer to Figure 7-13.Suppose the price of the good is $400.Then,on the first unit of the good that is sold,producer surplus amounts to
A) $200.
B) $300.
C) $400.
D) $450.

Question

Figure 7-13
 
-Refer to Figure 7-13.Suppose the price of the good is $400.Then,on the first unit of the good that is sold,producer surplus amounts to
A) $200. 
B) $300. 
C) $400. 
D) $450.

Quizplus · Accepted Answer

Producer surplus is the difference between the price at which a producer is willing to sell a good and the price at which it is sold. In Figure 7-13, the producer is willing to sell the first unit of the good for $100, but it is sold for $400. Therefore, the producer surplus for the first unit is $400 - $100 = $300.

Figure 7-13 -Refer to Figure 7-13.Suppose the Price of the Good Is