The table above lists the marginal cost of cowboy hats by The Waco Kid, a firm that specializes in producing western wear. If the market price of The Waco Kid's cowboy hats is $40, then Group of answer choices: producer surplus will equal $28. there will be a surplus; as a result, the price will fall to $24. producer surplus will equal $24. producer surplus from the first hat will equal $40.

The table above lists the marginal cost of cowboy hats by The Waco Kid, a firm that specializes in producing western wear. If the market price of The Waco Kid's cowboy hats is $40, then Group of answer choices: producer surplus will equal $28. there will be a surplus; as a result, the price will fall to $24. producer surplus will equal $24. producer surplus from the first hat will equal $40.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 3CQQ

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Use the table below to answer the question.

The Waco Kid's Cowboy Hats	Marginal Cost (dollars)
1st hat	$24
2nd hat	30
3rd hat	38
4th hat	46

The table above lists the marginal cost of cowboy hats by The Waco Kid, a firm that specializes in producing western wear. If the market price of The Waco Kid's cowboy hats is $40, then

Group of answer choices:

producer surplus will equal $28.

there will be a surplus; as a result, the price will fall to $24.

producer surplus will equal $24.

producer surplus from the first hat will equal $40.

Definition Definition Producer’s gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price and up to the equilibrium quantity.

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