Graphically,producer surplus is measured as the area:
A) above the demand curve and below the actual price.
B) under the demand curve and above the actual price.
C) above the supply curve and above the actual price.
D) above the supply curve and below the actual price.

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the amount a producer receives for a good or service and the minimum amount they would have been willing to accept for it. Graphically, it is measured as the area above the supply curve and below the actual price, as that represents the amount of money producers are receiving above their cost of production. Therefore, only option D matches this definition.

Graphically,producer Surplus Is Measured as the Area