Question

Alice, Amber, and Andi make and sell pottery. Alice is willing to sell a 5 inch pot for $20 , Amber is willing to sell a 5 inch pot for $22 , and Andi is willing to sell a 5 inch pot for $46 . If each of the ladies is able to sell one 5 inch pot for $50 , what is their combined producer surplus

Answer 1

$62

Step-by-step explanation:

Producer surplus is the difference between the price of a good and the least price the seller is willing to sell the product

Producer surplus = price least price the seller is willing to accept

Producer surplus :

For Alice = $50 - $20 = $30

For Amber = $50 - $22 = $28

For Andi = $50 - $46 = $4

Total producer surplus = $30 + $28 + $4 = $62