Suppose you are willing to pay $6.86 for a box of organic raspberries. You buy two boxes at $5.25 per box at a farmers' market. The lowest price the seller would accept is $4.15 a box. This transaction generated (enter numbers with two digits after the decimal point, e.g., 3.20) The consumer surplus $ The producer surplus $ The total gains from trade $
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A: Willingness to pay = 10 $ Paid amount = 4 $ Consumer surplus = 10 – 4 = 6
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- Scenario 8-2 Lincoln offers to do Katelyn's housework for $80 per week. Katelyn's opportunity cost of doing housework is $100 per week, and Lincoln's opportunity cost of doing housework is $50 per week. 16. Refer to Scenario 8-2. What will be Lincoln's gain in producer surplus as a result of the proposed transaction? a. Lincoln will gain $20 per week. b. Lincoln will gain $30 per week. c. Lincoln will gain $40 per week. d. Lincoln will gain $50 per week.In the market for a pair of shoes, Jena is willing to pay $75 for a pair while Jane is willing to pay $85 for a pair. The actual price that each must pay for a pair of shoes is $65. What is the combined amount of consumer surplus of Jena and Jane? Multiple Choice $10 $160 $30 $20If 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:
- Both a home buyer (A) and seller (B) of a house agree on a price of 2.5 million dollars. A values the house at 3 million dollars and B values the house at 2 million dollars. Before the date of delivery of the keys, C offers to buy this house from B for 3 million dollars because C values the house at 4 million. (a) Assuming transaction costs are zero (0), fully explain what actions A, B, and C will take and how social surplus will be distributed among them if A has the remedy of expectation damages against B. (b) Assuming transaction costs are zero (0), fully explain what actions A, B, and C will take and how social surplus will be distributed among them if A has the remedy of specific performance against B. (c) Assuming transaction costs are zero (0), fully explain what actions A, B, and C will take and how social surplus will be distributed among them if A has no remedy against B. (d) How high can transaction costs be before it matters which remedy A has?which statements are true Suppose favorable weather provides increases apple production. As a result, consumer surplus in the market for orange juice decreases because the supply curve of apple juice shifted to the The particular price that results in quantity supplied being equal to quantity demanded is the best price for consumers because it maximizes consumer surplus. The willingness to pay is the maximum amount that a buyer will pay for a good. Dora visits a clothing store to buy new dress suit. She is willing to pay $100 for the suit, but buys one on sale for $75. Dora's consumer surplus from the purchase is $75. If production technology improves in the shoe industry, consumer surplus for shoe buyers will increase because the rightward shift of supply caused the price to fall. Suppose that the equilibrium price in the market for heating oil is $3.50 per gallon. If a law imposed a price ceiling on the market and reduced the maximum legal price for heating oil to $3.00 per gallon…There are six potential consumers of computer games, each willing to buy only one game. Consumer 1 is willing to pay $40 for a computer game, consumer 2 is willing to pay $35, consumer 3 is willing to pay $30, consumer 4 is willing to pay $25, consumer 5 is willing to pay $20, and consumer 6 is willing to pay $15. Suppose the market price is $29. What is the total consumer surplus? The market price decreases to $19. What is the total consumer surplus now? When the price falls from $29 to $19, how much does each consumer’s individual consumer surplus change? How does total consumer surplus change?
- Refer to Figure 9-2. Without trade, consumer surplus amounts to Group of answer choices $9,720. $19,440. $23,280. $20,280.Refer to Table 6.6 . If the six people listed in the table are the only producers in the market and the equilibrium price is $6 (not the $8 shown), how much producer surplus will the market generate?then letting the market determine the price level and equilibrium amount is the most appropriate decision because the total surplus of consumers and producers is the most minimal the statement above is true/false?
- which statement is true In the absence of market power and externalities, efficiency is achieved in a market when the sum of producer surplus and consumer surplus is maximized. The benefit received by sellers in a market is measured by producer surplus and producer surplus is calculated as the amount sellers receive for their product minus the cost of production. In a market, the marginal buyer is the buyer who would be the first to leave the market if the price were any higher. Moving production from a high-cost producer to a low-cost producer will decrease total surplus. Suppose the United States changed its laws to allow for the legal sale of a kidney and the government allowed a free market in organs for transplant then there would be a decrease in the price of a kidney and an increase in the shortage of kidneys for transplant. Total surplus in the market is the summation of consumer surplus and producer surplus and it is maximized at the market equilibrium in the absence of…Suppose the demand and supply curves for good X are both linear. The demand price for the first unit of X is $28, and the supply price for the first unit of X is $6. If the equilibrium price for good X is $16 and the equilibrium quantity of X is 24,000 units, then total consumer surplus is ________, total producer surplus is ________, and total social surplus is ________. $144,000; $120,000; $264,000 $144,000; $672,000; $384,000 $120,000; $144,000; $264,000 $28; $6; $16 $672,000; $144,000; $384,000Suppose there are three identical blenders available to be purchased. Buyer 1 is willing to pay $30 for one, buyer 2 is willing to pay $25 for one, and buyer 3 is willing to pay $20 for one. If the price is $25, how many blenders will be sold and what is the value of consumer surplus in this market? * a. One blender will be sold and consumer surplus is $30. b. One blender will be sold and consumer surplus is $5. c. One blender will be sold and producer surplus is $5. d. Three blenders will be sold and consumer surplus is $0. e. None of these.