Question 5 1 pts Use the following information to answer the questions that foll

Question

Question 5 1 pts Use the following information to answer the questions that follow. The following graph depicts a market where a tax has been imposed. Pe was the equilibrium price before the tax was imposed, and Qe was the equilibrium quantity. After the tax, Pc is the price that consumers pay, and Ps is the price that producers receive. QT units are sold after the tax is imposed. NOTE: The areas B and C are rectangles that are divided by the supply curve ST. Include both sections of those rectangles when choosing your answers ST a Q Which areas represent producer surplus after the tax is imposed?

Explanation / Answer

Producers surplus is the difference between the price producers get for selling an output and the minimum price at which he is willing to sell the output. In the above figure, the PS is shown by the area of the triangle E.

The correct answer is, E.

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