Assume There Are Three Hardware Stores in the Market for Hammers

question 53

Multiple Choice

Assume there are three hardware stores in the market for hammers and that all three markets produce a single,standard model hammer.House Depot is an enormous mass producer of hammers and can offer a hammer for sale for a minimum of $7.Lace Hardware is a franchise and can offer the hammer for sale for a minimum of $10.Bob's Hardware store is a family owned and operated,independent hardware store and can offer hammers at a minimum price of $13.
Given the scenario described,if the market price of hammers increased from $9 to $12,total producer surplus would be:

• A)$3.
• B)$6.
• C)$7.
• D)$17.

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Definitions:

Cost Center

A department within a company where costs can be allocated, but which does not directly generate revenue.

Administrative Department

A segment within an organization responsible for managing general operations and administrative tasks.

Profit Center

A segment or department within a business that is responsible for generating its own revenue and profits.

Revenue Center

A division or unit within an organization responsible for generating revenue through its operations and activities.