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The market for tomatoes is in equilibrium at the price of $10, and quantity of 50 tomatoes. If consumer surplus is $400 and total surplus is $650, what is the producer surplus in the tomato market and why? * The producer surplus is $0, because producer surplus is offset by the costs of producing tomatoes. The producer surplus is $250 , because the total surplus less what consumers receive must go to producers. The producer surplus is -$400 , because consumer and producer surplus must offset one another. The producer surplus is $500 , because the producer surplus is the equilibrium price times the equilibrium quantity =$10×50=$500. The producer surplus is $650 , because producer surplus and total surplus are always equal.

The market for tomatoes is in equilibrium at the price of $10, and quantity of 50 tomatoes. If consumer surplus is $400 and total surplus is $650, what is the producer surplus in the tomato market and why? * The producer surplus is $0, because producer surplus is offset by the costs of producing tomatoes. The producer surplus is $250 , because the total surplus less what consumers receive must go to producers. The producer surplus is -$400 , because consumer and producer surplus must offset one another. The producer surplus is $500 , because the producer surplus is the equilibrium price times the equilibrium quantity =$10×50=$500. The producer surplus is $650 , because producer surplus and total surplus are always equal.

Principles of Microeconomics
Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter10: Externalities
Section: Chapter Questions
Problem 6PA: The many identical residents of Whoville love drinking Zlurp. Each resident has the following...
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The market for tomatoes is in equilibrium at the price of $10, and quantity of 50 tomatoes. If consumer surplus is $400 and total surplus is $650 , what is the producer surplus in the tomato market and why? * The producer surplus is $0, because producer surplus is offset by the costs of producing tomatoes. The producer surplus is $250 , because the total surplus less what consumers receive must go to producers. The producer surplus is -$400 , because consumer and producer surplus must offset one another. The producer surplus is $500 , because the producer surplus is the equilibrium price times the equilibrium quantity =$10×50=$500. The producer surplus is $650 , because producer surplus and total surplus are always equal. Assume that Coca Cola and Pepsi are substitute goods. If the price of Pepsi decreases, what will happen to the price and quantity sold of Coca-Colas? Price will increase and quantity sold will increase. O Price will increase and quantity sold will decrease. O Price will decrease and quantity sold will increase. O Price will decrease and quantity sold will decrease. O None of the above.
Transcribed Image Text:The market for tomatoes is in equilibrium at the price of $10, and quantity of 50 tomatoes. If consumer surplus is $400 and total surplus is $650 , what is the producer surplus in the tomato market and why? * The producer surplus is $0, because producer surplus is offset by the costs of producing tomatoes. The producer surplus is $250 , because the total surplus less what consumers receive must go to producers. The producer surplus is -$400 , because consumer and producer surplus must offset one another. The producer surplus is $500 , because the producer surplus is the equilibrium price times the equilibrium quantity =$10×50=$500. The producer surplus is $650 , because producer surplus and total surplus are always equal. Assume that Coca Cola and Pepsi are substitute goods. If the price of Pepsi decreases, what will happen to the price and quantity sold of Coca-Colas? Price will increase and quantity sold will increase. O Price will increase and quantity sold will decrease. O Price will decrease and quantity sold will increase. O Price will decrease and quantity sold will decrease. O None of the above.
ORIENTAL Flavor, Cayden receives a large raise at work and as a result, begins to buy fewer top ramen dinners. We can conclude that * NISSIN Top Ramen TRANS FAT odles of Noodles. Cooks in 3 minutes SERVITS SUGGESTO MEP NOODLE SOUP NET WT 3.0Z. (85 KLEL Cayden's demand for top ramen is not price sensitive. Cayden's demand for top ramen is price elastic. Cayden's demand for top ramen is inelastic. O for Cayden, top ramen is a normal good. for Cayden, top ramen is an inferior good.
Transcribed Image Text:ORIENTAL Flavor, Cayden receives a large raise at work and as a result, begins to buy fewer top ramen dinners. We can conclude that * NISSIN Top Ramen TRANS FAT odles of Noodles. Cooks in 3 minutes SERVITS SUGGESTO MEP NOODLE SOUP NET WT 3.0Z. (85 KLEL Cayden's demand for top ramen is not price sensitive. Cayden's demand for top ramen is price elastic. Cayden's demand for top ramen is inelastic. O for Cayden, top ramen is a normal good. for Cayden, top ramen is an inferior good.
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