Suppose that the market price for pizzas increases.The increase in producer surplus comes from the benefit of the higher prices to
A)only existing sellers who now receive higher prices on the pizzas they were already selling.
B)only new sellers who enter the market because of the higher prices.
C)both existing sellers who now receive higher prices on the pizzas they were already selling and new sellers who enter the market because of the higher prices.
D)Producer surplus does not increase;it decreases.

Question

Quizplus · Accepted Answer

The increase in producer surplus comes from both existing sellers who benefit from higher prices on pizzas they were already selling and new sellers who enter the market due to the higher prices.

Suppose That the Market Price for Pizzas Increases