EBK MACROECONOMICS
5th Edition
ISBN: 8220106773925
Author: KRUGMAN
Publisher: MAC HIGHER
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Question
Chapter 5.A, Problem 2P
To determine
The
Concept Introduction:
Producer Surplus: It is difference between the amount which the producer wants to receive and the real amount which he receives for goods and services.
The formula to calculate producer surplus is,
Supply Curve: The curve which shows how the quantity supplied changes due to change in the price. It is positively sloped curve.
Reservation Price: It is the minimum willing price of the producer below which he cannot indulge in the trade.
a. Producer surplus generated by Mr. G.
The producer surplus generated by Mr. G. from the sell of old Lionel electric train is $0.
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