Assume all benefits accrue to the buyer and all costs are borne by the seller. The demand curve is P(Qd)=MWTP(Q)= 16 – (18/10) x Q. Supply is perfect elastic at P=$5. How much surplus is generated at the efficient outcome? Round to two digits and do not enter a currency symbol. If your answer is $1.125, enter 1.13.
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- Refer to Exhibit 4-3. If P1 is a price ceiling, the maximum (per-unit) amount buyers are willing to pay to purchase Q1 units is Group of answer choices P1. P2. P3. P1 + P2. P3 - P1.Based on arguments made by Friedman and Fama, which of the following requirements must be fulfilled for noise traders to affect markets in equilibrium? Select all that apply. Noise traders must be able to survive economically for a significant period of time All traders must be risk averse Technical trading must be profitable at least some of the time Noise trader behavior must be systematicAnswer the given question with a proper explanation and step-by-step solution. Coffee and tea are considered substitute goods. A major coffee-producing country faces a disease outbreak in its coffee crops, reducing the yield drastically.How might this event impact the demand for tea? A. Cause a movement up along the demand curve for tea. B. Cause a leftward shift in the demand curve for tea. C. Cause a rightward shift in the demand curve for tea. D. Not impact the demand for tea at all.
- Which statement is true? Group of answer choices A competitive market maximises total surplus as all the gains from trade are realized. In a competitive market all trade for which the MB is greater than or equal to the MC of production take place. If output was increased beyond the traded in a competitive market total surplus would decrease. The competitive equilibrium outcome is Pareto efficient. All of the above. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Pharmaceutical Benefits Managers (PBMs) are intermediaries between upstream drug manufacturers and downstream insurance companies. They design formularies (lists of drugs that insurance will cover) and negotiate prices with drug companies. PBMs want a wider variety of drugs available to their insured populations, but at low prices. Suppose that a PBM is negotiating with the makers of two non-drowsy allergy drugs, Claritin and Allegra, for inclusion on the formulary. The “value” or “surplus” created by including one non-drowsy allergy drug on the formulary is $80 million, but the value of adding a second drug is only $24 million. Assume the PBM bargains by telling each drug company that it's going to reach an agreement with the other drug company. Under the non-strategic view of bargaining, the PBM would earn a surplus of_____million, while each drug company would earn a surplus of ________million. Now suppose the two drug companies merge. What is the likely post merger bargaining…Which of the following is an example of a hidden-market transaction? Question 14 options: A person buys a hotdog on a street corner. A person buys a product at a price greater than the government-imposed ceiling price. A person buys a product at a price below the government-imposed ceiling price. A person places a bet at a racetrack. A person buys a product at a price greater than the government-imposed price floor.
- In economics, customer sorting rules are often applied to understand how customers choose among various options based on their preferences and the available information. Which of the following best describes a common customer sorting rule? A. Price Maximization Rule B. Utility Maximization Rule C. Information Aversion Rule D. Brand Loyalty Rule Please refrain from offering handwritten solutions. Please ensure that your response maintains accuracy and quality to avoid receiving a downvote. Take care of plagiarism. Answer completely.How might imperfect information impact price? Group of answer choices Because buyers cannot determine the true quality of a product, they might tend to bid up the prices. Because they might not be able to present all the information about a product, sellers might temporarily lower the price to make potential buyers think the product is of excellent quality. Imperfect information might tend to cause prices to be perfectly elastic. Buyers cannot distinguish which goods have a higher quality and might be less likely to pay higher prices for that good.A new market appears that works according to the rules of the Stackelberg model. The costs of firms on this market as a function of individual supply q is C(q) = f + Cq^2, where both F > 0, C > 0. The demand is P(Q) = A - BQ as afunction of total supply Q, with A > 0, B > 0. What is the quantity of followers on the market assuming free entry (as a function of A B C and F) Assume entry costs Z, what is the new equilibrium quantity of firms?
- Producers' Surplus The demand function for a certain brand of CD is given by p = −0.01x2 − 0.2x + 7 where p is the unit price in dollars and x is the quantity demanded each week, measured in units of a thousand. The supply function is given by p = 0.01x2 + 0.1x + 2 where p is the unit price in dollars and x stands for the quantity that will be made available in the market by the supplier, measured in units of a thousand. Determine the producers' surplus if the market price is set at the equilibrium price. (Round your answer to the nearest dollar.) $Please explain both correct and incorrect option Which statement is true about a supply curve represented by a straight line equation such as : P = 5 x (Qs) Statement A: The elasticity of supply is constant. Statement B: The elasticity of supply is equal to one. Statement A and B are both incorrect. Statement A and B are both correct. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.You will get up vote for sure.For each of the alternatives below, explain for each one whether it is true, false or uncertain, based on the following statement:"Flour is an inferior good. So, if per capita income falls":(a) the supply of flour will shift to the left.(b) the quantity of flour supply will fall.c) The demand for flour will shift to the right.d) The demand for flour will shift to the left.