-In Figure 26.1, producer surplus under perfect competition is

Question

Quizplus · Accepted Answer

Producer surplus in a perfectly competitive market is represented by the area above the supply curve and below the equilibrium price. The notation FP₂C describes this area accurately, as it encompasses the space from the initial point of the supply curve (F) up to the equilibrium price level (P) and across to the corresponding point on the demand curve (C), then back down to the starting point on the supply curve.