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Figure: The Market for Hamburgers
-(Figure: The Market for Hamburgers)The figure The Market for Hamburgers shows the weekly market for hamburgers in Montreal,Quebec.If the price of burgers falls from $1.50 to $1.00,there is a loss in producer surplus.How much of the loss accrues as a direct result of the hamburgers that are no longer supplied in the market?
A) $50
B) $45
C) $75
D) $90

Question

Use the following to answer questions :
Figure: The Market for Hamburgers 
-(Figure: The Market for Hamburgers)The figure The Market for Hamburgers shows the weekly market for hamburgers in Montreal,Quebec.If the price of burgers falls from $1.50 to $1.00,there is a loss in producer surplus.How much of the loss accrues as a direct result of the hamburgers that are no longer supplied in the market?
A) $50 
B) $45 
C) $75 
D) $90

Quizplus · Accepted Answer

The loss in producer surplus due to hamburgers no longer supplied is the area of the triangle formed between the old and new supply quantities at the price drop. This area is calculated as 0.5 * (quantity difference) * (price difference), which equals $50.

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