Refer to the information provided in Figure 4.6 below to answer the questions that follow.
Equilibrium in this market occurs at the intersection of curves S and D. Figure 4.6
-In figure 4.6 if price is P1, producer surplus is area
A) A.
B) A+B+E.
C) G.
D) B+E+G.

Question

Refer to the information provided in Figure 4.6 below to answer the questions that follow.
Equilibrium in this market occurs at the intersection of curves S and D.  Figure 4.6
-In figure 4.6 if price is P1, producer surplus is area
A) A. 
B) A+B+E. 
C) G. 
D) B+E+G.

Quizplus · Accepted Answer

Producer surplus is the area above the supply curve and below the price level, which is area G when the price is P1.

Refer to the Information Provided in Figure 4