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Suppose There Are Three Sellers (D, E, and F) in a Competitive

Question 146

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Suppose there are three sellers (D, E, and F) in a competitive market with the marginal cost (MC) schedules shown in the table below. Calculate the producer surplus using the market supply curve. Assume that the market price is $5. Show that you get the same answer by adding together the producer surplus for all three sellers. How much does producer surplus increase for the market as a whole and for each individual when the market price rises to $7? Suppose there are three sellers (D, E, and F) in a competitive market with the marginal cost (MC) schedules shown in the table below. Calculate the producer surplus using the market supply curve. Assume that the market price is $5. Show that you get the same answer by adding together the producer surplus for all three sellers. How much does producer surplus increase for the market as a whole and for each individual when the market price rises to $7?

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