First, use the black point (plus symbol) to indicate the equilibrium price and quantity of commercial fans in the absence of a tax. Then use the green point (triangle symbol) to shade the area representing total consumer surplus (CS) at the equilibrium price. Next, use the purple point (diamond symbol) to shade the area representing total producer surplus (PS) at the equilibrium price. Before Tax 200 180 Equilibrium 160 Demand 140 Consumer Surplus 120 100 Producer Surplus 80 Supply 60 40 20 400 500 600 700 800 900 1000 100 200 300 QUANTITY (Fans) PRICE (Dollars per fan)

First, use the black point (plus symbol) to indicate the equilibrium price and quantity of commercial fans in the absence of a tax. Then use the green point (triangle symbol) to shade the area representing total consumer surplus (CS) at the equilibrium price. Next, use the purple point (diamond symbol) to shade the area representing total producer surplus (PS) at the equilibrium price. Before Tax 200 180 Equilibrium 160 Demand 140 Consumer Surplus 120 100 Producer Surplus 80 Supply 60 40 20 400 500 600 700 800 900 1000 100 200 300 QUANTITY (Fans) PRICE (Dollars per fan)

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter4: Prices: Free, Controlled, And Relative

Section: Chapter Questions

Problem 4WNG

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