Respuesta :
Answer:
The producer surplus before tax is $45 million.
The producer surplus after tax is $33 million.
Explanation:
The producer surplus is the difference between the minimum price a producer is willing to accept and the price he really gets.
The imposition of a tax reduces the price received by a seller such that the supply curve shifts to the left. The equilibrium quantity decreases.
The producer surplus before tax
= [tex]\frac{1}{2} \times\ price\ \times\ quantity[/tex]
= [tex]\frac{1}{2}\ \times\ 9\ \times\ 10[/tex]
= $45 million
The producer surplus after tax
= [tex]\frac{1}{2} \times\ price\ \times\ quantity[/tex]
= [tex]\frac{1}{2}\ \times\ 6\ \times\ 11[/tex]
= $33 million
With the imposition of tax the producer surplus falls by $12 million.
The change in economic surplus is $12 million. It is due to producer surplus before tax which is $45 million, and producer surplus after tax that is $33 million.
What is the producer's surplus?
The producer surplus can be understood as the gap between the number of goods that the producer or seller is willing to accept and what they get from the market after selling the product.
The main reason behind this is the application of taxes on the supply of goods.
The computation of producer surplus before tax (amount in millions):
[tex]\begin{aligned}\text{Producers Surplus}&=\frac{1}{2}\times\text{Price}\times\text{Quantity}\\&=\frac{1}{2}\times\$9\times\$10\\&=\$45\end{aligned}[/tex]
The computation of producer surplus after-tax (amount in millions):
[tex]\begin{aligned}\text{Producers Surplus}&=\frac{1}{2}\times\text{Price}\times\text{Quantity}\\&=\frac{1}{2}\times\$6\times\$11\\&=\$33\end{aligned}[/tex]
The economic surplus ($12 million) is the difference between the producer surplus before tax ($45 million) and producer surplus after-tax ($33 million).
Therefore, the economic surplus is $12 million.
Learn more about producers' surplus, here:
https://brainly.com/question/26530265
