Table 7-12
The only four producers in a market have the following costs:

-Refer to Table 7-12. If Evan, Selena, Angie, and Kris sell the good, and the resulting producer surplus is $700, then the price must have been
A) $200.
B) $300.
C) $500.
D) $700.

Question

Table 7-12
The only four producers in a market have the following costs:
 
-Refer to Table 7-12. If Evan, Selena, Angie, and Kris sell the good, and the resulting producer surplus is $700, then the price must have been
A) $200. 
B) $300. 
C) $500. 
D) $700.

Quizplus · Accepted Answer

The producer surplus is the difference between what producers are willing to accept and what they actually receive. If Evan, Selena, Angie, and Kris sell the good and the total producer surplus is $700, the price must have been $300, assuming their costs are such that this price results in that surplus.

Table 7-12 The Only Four Producers in a Market Have the Following