Use the following to answer questions:
Figure: Producer Surplus
-(Figure: Producer Surplus) In the diagram, if the market price of coffee is $6, how much producer surplus do suppliers earn?
A) $25
B) $125
C) $75.50
D) $62.50

Question

Use the following to answer questions:
Figure: Producer Surplus 
-(Figure: Producer Surplus) In the diagram, if the market price of coffee is $6, how much producer surplus do suppliers earn?
A) $25 
B) $125 
C) $75.50 
D) $62.50

Quizplus · Accepted Answer

Producer surplus is the area above the supply curve and below the market price. At a market price of $6, the producer surplus is calculated as the area of the triangle formed, which is 0.5 * base * height = 0.5 * 25 * 5 = $62.50.

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