Figure 7-12
-Refer to Figure 7-12.If the equilibrium price is $350,what is the producer surplus?
A)$60,000
B)$15,000
C)$30,000
D)$70,000

Question

Figure 7-12 
-Refer to Figure 7-12.If the equilibrium price is $350,what is the producer surplus?
A)$60,000 
B)$15,000 
C)$30,000 
D)$70,000

Quizplus · Accepted Answer

To calculate producer surplus, we need to find the area between the supply curve and the price line up to the quantity produced. In this case, the producer surplus would be (0.5)(500-350)(80) = $10,000 per week. Multiplied by the 3 weeks represented in the graph, this gives a total producer surplus of $30,000. Therefore, the correct choice is (C).

Figure 7-12 -Refer to Figure 7-12.If the Equilibrium Price Is $350,what Is