You are moving across town. Doing your research, you find that the average rate of a moving company is $250 per hour for a moving crew (moving truck included). The marginal benefit you receive from each hour of the movers' time (and truck) is listed in the accompanying table. Based on this information, you should hire movers for ____ and you will receive ______ in consumer surplus. Hours of movers' time Marginal benefit ($) 1 850 2 620 3 500 4 250 5 150 6 100 7 0 8 0 b. Now suppose that instead of paying per hour, a moving company offers a flat rate of $1,200 for movers plus a truck for an eight hour day. If you hired this moving company and used them for the entire eight hours, how much consumer surplus would you gain? consumer surplus: $ _______
You are moving across town. Doing your research, you find that the average rate of a moving company is $250 per hour for a moving crew (moving truck included). The marginal benefit you receive from each hour of the movers' time (and truck) is listed in the accompanying table. Based on this information, you should hire movers for ____ and you will receive ______ in consumer surplus. Hours of movers' time Marginal benefit ($) 1 850 2 620 3 500 4 250 5 150 6 100 7 0 8 0 b. Now suppose that instead of paying per hour, a moving company offers a flat rate of $1,200 for movers plus a truck for an eight hour day. If you hired this moving company and used them for the entire eight hours, how much consumer surplus would you gain? consumer surplus: $ _______
Chapter6: Consumer Choice And Demand
Section: Chapter Questions
Problem 3.10P
Related questions
Question
You are moving across town. Doing your research, you find that the average rate of a moving company is $250 per hour for a moving crew (moving truck included). The marginal benefit you receive from each hour of the movers' time (and truck) is listed in the accompanying table.
Based on this information, you should hire movers for ____ and you will receive ______ in consumer surplus.
Hours of movers' time | Marginal benefit ($) |
---|---|
1 | 850 |
2 | 620 |
3 | 500 |
4 | 250 |
5 | 150 |
6 | 100 |
7 | 0 |
8 | 0 |
b. Now suppose that instead of paying per hour, a moving company offers a flat rate of $1,200 for movers plus a truck for an eight hour day.
If you hired this moving company and used them for the entire eight hours, how much consumer surplus would you gain?
consumer surplus: $ _______
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you