Consider the production and sale of Good C. There are NO externalities associated with the production or consumption of Good C. Assume that Good C is sold in a competitive market. Thus, you can assume that the S Curve = Cost Curve, and that the D Curve = WTP Curve. You are told that the following points are on the Demand and Supply schedules( and thus also are points on the Demand and Supply Curves) for Good C: Price Qty. Demanded Qty. Supplied $ 3000 28 58 $ 2750 30 55 $ 2500 32 52 $ 2250 34 49 $ 2000 36 46 $ 1500 40 40 $ 1000 44 34 $ 500 48 28 a. ) What is the equilibrium price ( give a numerical answer)? b.) Solve for the Consumer’s Surplus ( CS) on unit number 34, IF it is sold at a price = $ 1500 c.) Solve for the total surplus ( to society) on unit number 34, IF it is sold at a price = $ 1500.
3. Consider the production and sale of Good C.
There are NO externalities associated with the production or consumption of Good C.
Assume that Good C is sold in a competitive market. Thus, you can assume that the S Curve = Cost Curve, and that the D Curve = WTP Curve.
You are told that the following points are on the
$ 3000 28 58
$ 2750 30 55
$ 2500 32 52
$ 2250 34 49
$ 2000 36 46
$ 1500 40 40
$ 1000 44 34
$ 500 48 28
a. ) What is the
b.) Solve for the
c.) Solve for the total surplus ( to society) on unit number 34, IF it is sold at a price = $ 1500.
THE FOLLOWING IS A COPY OF THE DATA LISTED AT THE BEGINNING OF THE PROBLEM:
Price Qty. Demanded Qty. Supplied
$ 3000 28 58
$ 2750 30 55
$ 2500 32 52
$ 2250 34 49
$ 2000 36 46
$ 1500 40 40
$ 1000 44 34
$ 500 48 28
d.) Solve for the
e.) Solve for the total surplus ( to society) on unit number 34, IF it is sold at a price = $ 2000.
f.) What is the efficient level of output ( give a numerical answer)?
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