Use the following to answer question:
-(Figure: Producer Surplus)Look at the figure Producer Surplus.When the price falls from $45 to $35,producer surplus _____ for a total producer surplus of _____.
A)increases by $10;$140
B)decreases by $40;$60
C)increases by $35;$180
D)decreases by $10;$140

Question

Use the following to answer question: 
-(Figure: Producer Surplus)Look at the figure Producer Surplus.When the price falls from $45 to $35,producer surplus _____ for a total producer surplus of _____.
A)increases by $10;$140 
B)decreases by $40;$60 
C)increases by $35;$180 
D)decreases by $10;$140

Quizplus · Accepted Answer

Producer surplus decreases when the price falls because producers are receiving less money for their goods. The specific amounts depend on the details of the supply curve and the price change, but generally, a decrease in price leads to a decrease in producer surplus.

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