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Thus, the overall change in producer surplus is the difference between A and B, or $9620 per night. Thus, the Association would certainly be interested
Thus, the overall change in producer surplus is the difference between A and B, or $9620 per night. Thus, the Association would certainly be interested in lobbying for a quantity restriction (perhaps in the form of a maximum number of liquor licenses permitted). The value gained from such a restriction would be $9620 per night, or roughly $3.5 million per year; this is the maximum amount the Association would be willing to spend in order to increase their profits (at the expense of consumer surplus and overall economic efficiency)
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