Table 4-3

-Refer to Table 4-3.The table above lists the marginal cost of polo shirts by Marko's,a firm that specializes in producing men's clothing.If the market price of Marko's polo shirts is $30,producer surplus is
A)$0.
B)$16.
C)$52.
D)$68.

Question

Table 4-3
 
-Refer to Table 4-3.The table above lists the marginal cost of polo shirts by Marko's,a firm that specializes in producing men's clothing.If the market price of Marko's polo shirts is $30,producer surplus is
A)$0. 
B)$16. 
C)$52. 
D)$68.

Quizplus · Accepted Answer

Producer surplus is the difference between the market price and the marginal cost of production, summed across all units produced. Given a market price of $30, we calculate the producer surplus by subtracting the marginal costs from $30 for each unit and summing these differences. The table must show marginal costs below $30 for several units, and the total of these differences equals $68.

Table 4-3 -Refer to Table 4-3.The Table Above Lists the Marginal Cost