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Question:
The supply function for a good is: quantity supplied = -170 + 10 x price. If the market price is 25, the value of producer surplus is:
A
320.
explanation
Quantity supplied is zero at P = 17, and quantity supplied at P = 25 is 80. The area of the producer surplus triangle is 1/2 x (25$ — 17) x 80 = 320.
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