FIGURE 4-3Producer Surplus in the Used-Textbook Market
imageAt a price of $30, Andrew, Betty, and Carlos each sell a book but Donna and Engelbert do not. Andrew, Betty, and Carlos get individual producer surpluses equal to the difference between the price and their cost, illustrated here by the shaded rectangles. Donna and Engelbert each have a cost that is greater than the price of $30, so they are unwilling to sell a book and so receive zero producer surplus. The total producer surplus is given by the entire shaded area, the sum of the individual producer surpluses of Andrew, Betty, and Carlos, equal to $25 + $15 + $5 = $45.