What is the TOTAL producer surplus in the contact lens market?? I don't understand or know how to figure out the total producer surplus?PS- the graph and table reflect the contact lens market. JulioDomestic Market: No TradeSure, producer surplus is the difference between the pricefirms are willing and able to sell their contacts for and theactual price that they receive.No International TradeVivan240 -200 -For example, in the contact lens market, producers wouldbe willing to sell 40 boxes of contact lenses for $40 a box,but the market equilibrium price is $120.160 -120 -80 -A producer willing to supply a set of contact lenses for $40will therefore receive producer surplus of ($120 - $40 = $80)when they sell their product for $120.40 -Vivan0-120160200o Quantity Supplied - Quantity DemandedWhile we could figure this out for all producers and add upthe results, there's an easier way using the graph.Domestic MarketPriceQuantity SuppliedQuantity Demanded240Vivan2020220Graphically, producer surplus is the area from the marketprice ($120) down to the supply curve and over to theequilibrium quantity of 120.40402006060180Vivan8080160100100140Got it! So what is total producer surplus in the contact lensmarket?120120120140140100Julio160160801801806020020040Enter a response then click Submit below22022020240240

Producer surplus: - it is the difference between a producer’s willingness to accept and the price he…

Answered: What is the TOTAL producer surplus in…

What is the TOTAL producer surplus in the contact lens market?? I don't understand or know how to figure out the total producer surplus? PS- the graph and table reflect the contact lens market.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

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What is the TOTAL producer surplus in the contact lens market?? I don't understand or know how to figure out the total producer surplus?

PS- the graph and table reflect the contact lens market.

Julio
Domestic Market: No Trade
Sure, producer surplus is the difference between the price
firms are willing and able to sell their contacts for and the
actual price that they receive.
No International Trade
Vivan
240 -
200 -
For example, in the contact lens market, producers would
be willing to sell 40 boxes of contact lenses for $40 a box,
but the market equilibrium price is $120.
160 -
120 -
80 -
A producer willing to supply a set of contact lenses for $40
will therefore receive producer surplus of ($120 - $40 = $80)
when they sell their product for $120.
40 -
Vivan
0-
120
160
200
o Quantity Supplied - Quantity Demanded
While we could figure this out for all producers and add up
the results, there's an easier way using the graph.
Domestic Market
Price
Quantity Supplied
Quantity Demanded
240
Vivan
20
20
220
Graphically, producer surplus is the area from the market
price ($120) down to the supply curve and over to the
equilibrium quantity of 120.
40
40
200
60
60
180
Vivan
80
80
160
100
100
140
Got it! So what is total producer surplus in the contact lens
market?
120
120
120
140
140
100
Julio
160
160
80
180
180
60
200
200
40
Enter a response then click Submit below
220
220
20
240
240

Definition Definition Producer’s gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price and up to the equilibrium quantity.

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