Use the following to answer question:
-(Figure: Wireless Mouse Market)Look at the figure Wireless Mouse Market.Calculate the change in producer surplus when the price increases from $10 to $15.
A)$250
B)$1,000
C)$625
D)$1,125

Question

Use the following to answer question: 
-(Figure: Wireless Mouse Market)Look at the figure Wireless Mouse Market.Calculate the change in producer surplus when the price increases from $10 to $15.
A)$250 
B)$1,000 
C)$625 
D)$1,125

Quizplus · Accepted Answer

To calculate the change in producer surplus, we need to first find the producer surplus at each price level. At $10, producer surplus is the area of the triangle between the supply curve and the equilibrium point, which is (20-10) x (100-0) / 2 = $500. At $15, producer surplus is the area of the rectangle above the supply curve and between the two price levels, which is (15-10) x (100-20) = $500 - $125 = $375. Therefore, the change in producer surplus is $375 - $500 = -$125. However, since producer surplus is measured as a positive value, we take the absolute value and get $125, which is closest to option C.

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