Producer surplus is measured as the:
A) area under the demand curve above market price.
B) entire area under the supply curve.
C) area under the demand curve above the supply curve.
D) area above the supply curve up to the market price.

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the price at which a good or service can be sold and the minimum price at which suppliers are willing to supply that good or service. This is represented by the area above the supply curve up to the market price, as it shows the amount that producers are receiving above their costs of production. Therefore, option D is the correct answer.

Producer Surplus Is Measured as The