Table 7-17

-Refer to Table 7-17. Both the demand curve and the supply curve are straight lines. At equilibrium, producer surplus is
A) $24.
B) $32.
C) $48.
D) $64.

Question

Table 7-17
 
-Refer to Table 7-17. Both the demand curve and the supply curve are straight lines. At equilibrium, producer surplus is
A) $24. 
B) $32. 
C) $48. 
D) $64.

Quizplus · Accepted Answer

Producer surplus is the vertical distance between the supply curve and the equilibrium price. In this case, the equilibrium price is $40 and the supply curve is a straight line with a slope of 1. Therefore, the producer surplus is $24.

Table 7-17 -Refer to Table 7-17. Both the Demand Curve and the Demand