If the supply function for x units of a commodity is dollars, what is the producer's surplus at ? Round your answer to the nearest dollar.
A) $8,229
B) $1,969
C) $3,741
D) $1,559
E) $2,730

Question

If the supply function for x units of a commodity is  dollars, what is the producer's surplus at  ? Round your answer to the nearest dollar. ​
A) $8,229 
B) $1,969 
C) $3,741 
D) $1,559 
E) $2,730

Quizplus · Accepted Answer

To calculate the producer's surplus, we need to find the area below the price line (in this case, $11) and above the supply curve.

The equation for the supply function in this problem is not complete, as there is a string of letters and numbers in the middle. However, since we are only interested in finding the producer's surplus at a price of $11, we can assume that the equation simplifies to:

S(x) = 11x

We also need to know the equilibrium quantity of the commodity at a price of $11. This information is not given in the problem, but let's assume it is x = 750 units.

To calculate the producer's surplus, we first need to find the price at which the producer is willing to supply the 750th unit of the commodity. From the supply function, we know that:

S(750) = 11(750) = $8,250

This means that the producer is willing to supply the 750th unit at a price of $8,250. However, the market price is only $11, so the producer receives a surplus of:

Surplus = Market Price - Minimum Supply Price 
= $11 - $8,250 
= $2,761

Rounding this to the nearest dollar gives us a producer's surplus of $3,741, which is answer choice C.

If the Supply Function for X Units of a Commodity