Kristi and Rebecca sell lemonade on the corner for $0.50 per cup.It costs them $0.10 to make each cup.On a certain day,their producer surplus is $20.How many cups did Kristi and Rebecca sell?
A)40.
B)200.
C)8.
D)50.

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the market price and the cost of production, multiplied by the quantity sold. In this case, the market price is $0.50 and the cost of production is $0.10, which gives a producer surplus of $0.40 per cup sold. To find the total number of cups sold, we can divide the producer surplus by the producer surplus per cup:

$20 ÷ $0.40 = 50

Therefore, Kristi and Rebecca sold 50 cups of lemonade.

Kristi and Rebecca Sell Lemonade on the Corner for $0