Exhibit 13-6 Refer to Exhibit 13-6.In single price monopoly,producer surplus is area:
A) d
B) d + e
C) b + d
D) b + c + d + e

Question

Exhibit 13-6  Refer to Exhibit 13-6.In single price monopoly,producer surplus is area:
A) d 
B) d + e 
C) b + d 
D) b + c + d + e

Quizplus · Accepted Answer

Producer surplus is the difference between the price at which a firm sells its product and the minimum price at which it would have been willing to sell it. In this exhibit, the minimum price a monopoly producer would have been willing to sell at is point b, and the price it actually sells at is point d. Therefore, producer surplus is area b + d.