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Question
Table 4-3| The Waco Kid's Cowboy Hats | Marginal Cost (dollars) |
| 1st hat | $24 |
| 2nd hat | 30 |
| 3rd hat | 38 |
| 4th hat | 46 |
Refer to Table 4-3. The table above lists the marginal cost of cowboy hats by The Waco Kid, a firm that specializes in producing western wear. If the market price of The Waco Kid's cowboy hats is $40
A) The Waco Kid will produce four hats.
B) producer surplus from the first hat is $40.
C) producer surplus will equal $28.
D) there will be a surplus; as a result, the price will fall to $24.
Answer
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