Biology Forums - Study Force

Producer surplus:
 a. measures the value between the actual selling price of a product and the price at which sellers are willing to sell the product.
  b. is illustrated by the area above the supply curve and below the market price.
  c. is maximized in market equilibrium.
  d. all of these.

QUESTION 2

Suppose Gizmo Inc is willing to sell one gizmo for 10, a second gizmo for 12, a third for 14, and a fourth for 20, and the market price is 20 . What is Gizmo Inc's producer surplus?
 a. 56 b. 24
  c. 20 d. 10

QUESTION 3

Suppose Alice sells a good for 60 on eBay. If the producer surplus from the sale is 25, Alice's cost of the good must have been:
 a. 35 b. 25.
  c. 60 d. 85.

QUESTION 4

Suppose Jones sells a good for 100 at a yard sale. If the producer surplus from the sale is 75, Jones's cost of the good must have been:
 a. 100 b. 175.
  c. 25 d. equal to the deadweight loss.

QUESTION 5

Assuming peaches are a normal good and consumer incomes rise, producer surplus in the peach market:
 a. increases. b. decreases.
  c. remains unchanged. d. equals the deadweight loss increase.

QUESTION 6

Which of the following is not true concerning producer surplus?
 a. It is qraphically the area under the supply curve and above the market price.
  b. It exists in equilibrium.
 c. A leftward shift of the supply curve will decrease producer surplus.
 d. A rightward shift of the supply curve will increase producer surplus.

QUESTION 7

Using supply and demand curve analysis, the triangular area below the equilibrium price and above the supply curve is:
 a. consumer surplus.
  b. producer surplus.
  c. marginal cost.
 d. deadweight loss.

QUESTION 8

Producer surplus is the:
 a. amount by which the quantity supplied of a good exceeds the quantity demanded of a good.
  b. measure of producers' willingness to sell a good plus the price of the good.
  c. measure of how much producers value a good.
  d. amount consumers actually pay for a good minus the amount the sellers are willing to sell the good.

Content hidden