Answered: Price of hamburger $5.00 4.50 4.00 3.50…

Price of hamburger $5.00 4.50 4.00 3.50 3.00 2.50 2.00 1.50 1.00 0.50 0 S₁ D₁ 100 200 300 400 500 600 700 800 Quantity of hamburgers (per week)

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter6: Consumer Choices

Section: Chapter Questions

Problem 13CTQ: Think back to a purchase that you made recently. How would you describe your thinking before you...

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Question

If the price of a hamburger falls from $2.00 to $1.50, the gain in consumer surplus to consumers who are persuaded to buy at the lower price (and who were not buying when the price was $2.00) is equal to:

Price of
hamburger
$5.00
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0
S₁
D₁
100 200 300 400 500 600 700 800
Quantity of hamburgers
(per week)
Use figure above

Consumer’s gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price and up to the equilibrium quantity. Consumer surplus is represented by area A.

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