Consider the domestic market for Good X in Country A, graphed above. P0=$5, P1=$25, P2=$10, P*=$15, Pw=$20, Q1=40, Q*=80, Q2=120. The world market outside country A observes a price Pw for Good X. When international trade is allowed, what is the total producer surplus? (Do not include the dollar sign $ in your answer)

Respuesta :

Based on the graph and information provided, the total producer surplus will be $900.

The producer surplus simply refers to the difference between how much an individual would be willing to accept for a particular good and how much the person eventually receives when the good is sold.

It should be noted that the difference or surplus amount that the producer gets is the producer surplus. Based on the graph, the producer surplus is $900.

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