Which of the following best describes the responsibility of the producer in the context of producer surplus and willingness to sell?

• A. To maximize consumer surplus by lowering prices
• B. To supply goods only if the market price is greater than or equal to their minimum acceptable price
• C. To set the market price for all goods sold
• D. To purchase goods from consumers at the lowest possible price

Answer: (B)

Verified step by step guidance

1. Understand the concept of producer surplus: it is the difference between the market price a producer receives and the minimum price at which they are willing to sell a good.
2. Recognize that a producer's willingness to sell is based on their minimum acceptable price, which covers their costs and provides some profit.
3. Identify that producers will supply goods only if the market price is at least equal to their minimum acceptable price, ensuring they do not incur losses.
4. Note that producers do not set the market price; instead, the market price is determined by the interaction of supply and demand.
5. Conclude that the producer's responsibility in this context is to supply goods only when the market price meets or exceeds their minimum acceptable price, aligning with the concept of producer surplus.