Table 4-6

-Refer to Table 4-6. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the price of polo shirts increases from $15 to $20,
A) consumers will buy no polo shirts.
B) the marginal cost of producing the third polo shirt will increase to $20.
C) producer surplus will rise from $13 to $28.
D) there will be a surplus of polo shirts.

Question

Table 4-6
 
-Refer to Table 4-6. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the price of polo shirts increases from $15 to $20,
A) consumers will buy no polo shirts. 
B) the marginal cost of producing the third polo shirt will increase to $20. 
C) producer surplus will rise from $13 to $28. 
D) there will be a surplus of polo shirts.

Quizplus · Accepted Answer

Producer surplus increases because the firm receives a higher price for each unit sold, while the cost of production remains the same.

Table 4-6 -Refer to Table 4-6. the Table Above Lists the Marginal