Suppose you're willing to tutor a student for $10 an hour.The student pays you $15 an hour.What is your producer surplus?
A) $5 an hour
B) $10 an hour
C) $15 an hour
D) $25 an hour
E) More than $25 an hour

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the price at which a seller is willing to sell a good or provide a service and the price they actually receive.

In this case, you are willing to tutor a student for $10 an hour but are receiving $15 an hour from the student. Therefore, your producer surplus is the difference between these two prices, which is $5 an hour.

Suppose You're Willing to Tutor a Student for $10 an Hour.The