MCQ 11 Mark
If the supply function for a commodity is p = 4 + x and 12 units of goods are sold, then the producer's surplus is given by:
- A70
- ✓72
- C12
- D48
Answer
View full question & answer→Correct option: B.
72
(B) 72
Explanation: Given, the supply function is
p = 4 + x .....(i)
and the market demand $x_0=12$.
At equilibrium, $p_0=4+x_0$
Substituting this value of $x_0$ in (i), we get
$p_0=4+12$
$\Rightarrow \quad p_0=16$
So, Producer's Surplus
$\begin{array}{l}=12 \times 16-\int_0^{12}(4+x) d x \\ =192-\left[4 x+\frac{x^2}{2}\right]_0^{12} \\ =192-(48+72)+0 \\ =192-120 \\ =72\end{array}$
Explanation: Given, the supply function is
p = 4 + x .....(i)
and the market demand $x_0=12$.
At equilibrium, $p_0=4+x_0$
Substituting this value of $x_0$ in (i), we get
$p_0=4+12$
$\Rightarrow \quad p_0=16$
So, Producer's Surplus
$\begin{array}{l}=12 \times 16-\int_0^{12}(4+x) d x \\ =192-\left[4 x+\frac{x^2}{2}\right]_0^{12} \\ =192-(48+72)+0 \\ =192-120 \\ =72\end{array}$

