MICROECONOMICS FOR TODAY (LL)-W/MINDTAP
10th Edition
ISBN: 9781337739115
Author: Tucker
Publisher: CENGAGE L
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Chapter 3.A, Problem 6SQ
To determine
The
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Assume competitive markets (prices are given) and that the demand is more elastic than supply. Which of the following statements is correct?
A. We do not have sufficient information to infer which surplus is greater
B. Consumer surplus will be larger than producer surplustyping
C. Consumer surplus will be exactly the same as producer surplus
D. Consumer surplus will be smaller than producer surplus.
Give typing answer with explanation and conclusion
Figure 3-16
Price
P2
:B
A
P1
Q1
Q2
Quantity
Refer to Figure 3-16. When the price is P2, producer surplus is
A.
A + C.
A + B + C.
D+E.
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b. How much does this new technology increase consumer surplus?
Increase in consumer surplus: $
1050
Increase in producer surplus: $
Incorrect
c. How much does this new technology increase producer surplus?
1050
Incorrect
d. How much does this new technology increase total (or social) surplus?
Chapter 3 Solutions
MICROECONOMICS FOR TODAY (LL)-W/MINDTAP
Ch. 3.7 - Prob. 1YTECh. 3.7 - Prob. 1GECh. 3.7 - Prob. 2GECh. 3.7 - Prob. 3GECh. 3.A - Prob. 1SQPCh. 3.A - Prob. 2SQPCh. 3.A - Prob. 3SQPCh. 3.A - Prob. 4SQPCh. 3.A - Prob. 1SQCh. 3.A - Prob. 2SQ
Ch. 3.A - Prob. 3SQCh. 3.A - Prob. 4SQCh. 3.A - Prob. 5SQCh. 3.A - Prob. 6SQCh. 3.A - Prob. 7SQCh. 3.A - Prob. 8SQCh. 3.A - Producer surplus measures the value between the...Ch. 3.A - Prob. 10SQCh. 3.A - Prob. 11SQCh. 3.A - Prob. 12SQCh. 3.A - Prob. 13SQCh. 3.A - Prob. 14SQCh. 3.A - Prob. 15SQCh. 3.A - Prob. 16SQCh. 3.A - Prob. 17SQCh. 3.A - Prob. 18SQCh. 3.A - Prob. 19SQCh. 3.A - Prob. 20SQCh. 3 - Prob. 1SQPCh. 3 - Prob. 2SQPCh. 3 - Prob. 3SQPCh. 3 - Prob. 4SQPCh. 3 - Prob. 5SQPCh. 3 - Prob. 6SQPCh. 3 - Prob. 7SQPCh. 3 - Prob. 8SQPCh. 3 - Prob. 9SQPCh. 3 - Prob. 10SQPCh. 3 - Prob. 11SQPCh. 3 - Prob. 12SQPCh. 3 - Prob. 1SQCh. 3 - Which of the following would not cause market...Ch. 3 - Prob. 3SQCh. 3 - Prob. 4SQCh. 3 - Prob. 5SQCh. 3 - Prob. 6SQCh. 3 - Prob. 7SQCh. 3 - Prob. 8SQCh. 3 - Prob. 9SQCh. 3 - Prob. 10SQCh. 3 - Prob. 11SQCh. 3 - Prob. 12SQCh. 3 - Prob. 13SQCh. 3 - Prob. 14SQCh. 3 - Prob. 15SQCh. 3 - Prob. 16SQCh. 3 - Prob. 17SQCh. 3 - Prob. 18SQCh. 3 - Prob. 19SQCh. 3 - Prob. 20SQCh. 3 - Prob. 21SQCh. 3 - Prob. 22SQCh. 3 - Prob. 23SQCh. 3 - Prob. 24SQCh. 3 - Prob. 25SQ
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- The area underneath a demand curve down to the equilibrium price is: a. consumer surplus b. always less than the area under the supply curve c. always greater than the area under the supply curve d. producer surplusarrow_forwardQ20 In Canada we have government intervention in the dairy market in the form of quotas on milk production. What are two predicted economic effects of this policy? a. A redistribution of income from dairy farmers to consumers of dairy products and an increase in the total amount of economic surplus in the dairy market. b. An equitable distribution of income between dairy farmers and consumers of dairy products and a reduction in the total amount of economic surplus in the dairy market. c. A redistribution of income from consumers of dairy products to dairy farmers and a reduction in deadweight loss in the dairy market. d. A redistribution of income from dairy farmers to consumers of dairy products and a reduction in the total amount of economic surplus in the dairy market. e. A redistribution of income from consumers of dairy products to dairy farmers and a reduction in the total amount of economic surplus in the dairy market. Clear my choicearrow_forwardWhich of the following will cause a decrease in consumer surplus? a. an increase in the number of sellers of the good b. a decrease in the production cost of the good c. sellers expect the price of the good to be lower next month d. the imposition of a binding price floor in the marketarrow_forward
- C. With the price floor at $1.05 per pound of butter, show the areas that represent deadweight loss, consumer surplus, and producer surplus. Calculate each and show your work. Is total surplus higher or lower than in the free market? Price of butter (per pound) $1.20 1.15 1.10 1.05 1.00 Price floor 0.95 0.90 0.85 1.60 1.65 1.70 Quantity of butter (billions of pounds) %24arrow_forwardPrice S2 Tax B. Amount of the tax D. Quantity Click to view larger image. Look at the provided figure. What area(s) represent producer surplus before the tax? OC+E+ F OC+D+F O C+ D O D F.arrow_forwardThe diagram to the right shows a market in which a price floor has been imposed. Identify the K following (enter al values as integers). a. The deadweight loss in $. b. The transfer of consumer surplus to producers is $. c. Producer surplus with this price floor is d. Consumer surplus with this price floor is $20000 6.00 5.00 3.00 2.00 30,000 60,000 Quantity Demand dduarrow_forward
- Why does producer surplus arise? Consumers buy less of some commodities than they need. Sellers' costs of production for some goods are less than the market price. Producers make more off some commodities than the consumers desire. Sellers manufacture more units of a good than consumers are willing to purchase.arrow_forwardTonya has been working as a tutor for $300 a semester. The college raised the wage it pays tutors to $400 which makes Tonya more happy. How has Tonya's producer surplus changed? a. Producer surplus increased by $400. b. Producer surplus did not change. c. Producer surplus increased by $100. d. No change in Producer Surplus because this is a Consumer Surplus problem.arrow_forwardThat’s the graph of the last problemarrow_forward
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