Graph 7-3 -According to Graph 7-3, area B represents: A) producer surplus to new producers entering the market as the result of price rising from P₁ to P₂ B) the increase in consumer surplus that results from an upward-sloping supply curve C) a decrease in producer surplus to each producer in the market D) an increase in total surplus when sellers are willing and able to increase supply from Q₁ to Q₂

Question

Quizplus · Accepted Answer

Area B represents the producer surplus gained by new producers entering the market as a result of the price rising from P₁ to P₂. This area is delineated by the vertical distance between the supply curve and the new equilibrium price line for the additional quantity supplied.

Graph 7-3 -According to Graph 7-3, Area B Represents