Question

Tim mows neighborhood lawns for extra money. Suppose that he would be willing to mow one lawn for ​$10​, a second lawn for ​$15​, and a third lawn for ​$24. Also suppose that three neighbors are interested in having their lawns mowed. Mrs. Jones would be willing to pay ​$31 to have her lawn​ mowed, Mr. Wilson would be willing to pay ​$30​, and Ms. Smith would be willing to pay ​$24. If Tim offers to mow lawns for ​$24 ​each, what will be his producer​ surplus? ​$ nothing. ​(Enter a numeric response using an​ integer.)

Answer 1

The producer surplus is $23

Step-by-step explanation:

Producer surplus: The producer surplus show a difference between the producer willing to supply and the received price

In mathematically,

Producer surplus = (willing to supply - received price by the consumer)

So,

The producer surplus would equal to

= ($24 - $10) + ($24 - $15) + ($24 - $24)

= 14$ + $9 + $0

= $23