Which of the Following Formulas Is Not a Valid Characterization

question 106

Multiple Choice

Which of the following formulas is not a valid characterization of producer surplus?

• A)Total revenue - the sum of marginal costs
• B)Profit + fixed costs
• C)Profit - marginal costs
• D)Total revenue - (total costs- fixed costs)
• E)(P -MC₁) + (P - MC₂) + (P -MC₃) + J + (P -MC_Q), where Q = quantity produced and sold

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Definitions:

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