One can determine producers' surplus if the minimum selling price and the _____________ is known.
A) price received
B) price paid
C) tax paid
D) tax received
E) a and c

Question

Quizplus · Accepted Answer

Producers' surplus is the difference between the price that producers are willing and able to sell a good for and the price that they actually receive. Therefore, the minimum selling price (what producers are willing to sell for) and the price received (what they actually receive) are the only factors necessary to determine producers' surplus. Tax paid or tax received are not directly relevant to calculating producers' surplus.

One Can Determine Producers' Surplus If the Minimum Selling Price