The above figure shows a market.
-If the market in the figure above is a profit-maximizing single-price monopoly,the producer surplus is the area ________.

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the price a monopolist is able to charge and the cost of production. In this case, the monopolist is charging price Pm and producing quantity Qm. The cost of producing Qm is represented by the area BDEH. Therefore, the producer surplus is the area above the cost curve and below the price, which is represented by the triangle BDEH.

The Above Figure Shows a Market