Asked by Rafaiel Ghazaryan on Jul 07, 2024

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If the price of a good rises along an upward-sloping supply curve,then producer surplus:

A) will increase.
B) will decrease.
C) will remain the same.
D) may change,but we can't tell how.

Producer Surplus

The difference between what producers are willing to accept for a good or service versus what they actually receive, often depicted as an area on a graph.

Supply Curve

A graphical representation showing the relationship between the price of a good and the quantity of the good that suppliers are willing to sell.

  • Gain insight into the idea of producer surplus and the impact market fluctuations have on it.
  • Understand the linkage between adjustments in the supply curve, price changes, and the surplus of producers.
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Verified Answer

AB
Adrian BravoJul 10, 2024
Final Answer :
A
Explanation :
When the price of a good rises along an upward-sloping supply curve, it means that producers are able to sell their goods at a higher price, which increases their revenue. As a result, producer surplus – which is the difference between the market price and the cost of production – will increase.