Graph 8-2 This graph shows supply and demand in a free market.
-According to Graph 8-2, when the market is in equilibrium, producer surplus is represented by area:
A)A
B)B
C)C

Question

Graph 8-2  This graph shows supply and demand in a free market.
-According to Graph 8-2, when the market is in equilibrium, producer surplus is represented by area:
A)A 
B)B 
C)C

Quizplus · Accepted Answer

Producer surplus is the difference between the price a seller receives and the minimum amount they would be willing to sell the product for. In Graph 8-2, producer surplus is represented by the area above the supply curve and below the equilibrium price (represented by the dotted line). The area defined by C represents the producer surplus.

Graph 8-2 This Graph Shows Supply and Demand in a Free