MICROECONOMICS(LL)COMPANION
21st Edition
ISBN: 9781260713541
Author: McConnell
Publisher: MCG
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Question
Chapter 4, Problem 2P
To determine
The producer surplus .
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Students have asked these similar questions
17. You're given the following supply and demand
table: (LO5-5)
P
$0
2
4
6
8
10
12
14
Demand
Q
1,000
800
700
500
300
200
100
0
P
$0
2
4
6
8
10
12
14
Supply
Q
0
200
400
500
700
900
1,100
1,200
a.
What is equilibrium price and quantity in a market
system with no interferences?
b.
If this were a third-party-payer market where the con-
sumer pays $4, what is the quantity demanded? What
is the price charged by the seller?
c. What is total spending in the two situations described
in a and b?
The graph shows the market for tutoring at a university.
Price (per hour
of tutoring)
$25
20
15
10
7.50
LO
5
2.50
S
D
100 200 300 400 500 600 700 800 900
Quantity (hours of tutoring per week)
If there is a price floor of $15, consumer surplus is, in numerals, $.
20
18
16
14
12
10
8
D
4
2
0 1 2
3
4
5
6 7
8
9.
10 11 12
Quantity
Suppose that supply and demand at a market are represented by curves S and D at
the figure above (notice that the vertical axis grid has increments of $2) and then a
tax of $6 dollars per unit is imposed on buyers.
What is the new equilibrium market price?
$12
$16
$8
$10
Price
LO
Chapter 4 Solutions
MICROECONOMICS(LL)COMPANION
Ch. 4.A - Prob. 1ADQCh. 4.A - Prob. 2ADQCh. 4.A - Prob. 3ADQCh. 4.A - Prob. 1ARQCh. 4.A - Prob. 2ARQCh. 4.A - Prob. 3ARQCh. 4.A - Prob. 1APCh. 4 - Prob. 1DQCh. 4 - Prob. 2DQCh. 4 - Prob. 3DQ
Ch. 4 - Prob. 4DQCh. 4 - Prob. 5DQCh. 4 - Prob. 6DQCh. 4 - Prob. 7DQCh. 4 - Prob. 8DQCh. 4 - Prob. 9DQCh. 4 - Prob. 1RQCh. 4 - Prob. 2RQCh. 4 - Prob. 3RQCh. 4 - Prob. 4RQCh. 4 - Prob. 5RQCh. 4 - Prob. 6RQCh. 4 - Prob. 7RQCh. 4 - Prob. 1PCh. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7P
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Similar questions
- Sam is willing to pay $10 for one bracelet and $5 for a second. Isabella is willing to pay $12 for one bracelet and $9 for a second. If the price is currently $8 per bracelet, what is the total consumer surplus when Sam and Isabella make their purchases? O $7 O $8 O $6 O $5arrow_forwardO O 198765432 O 10 Suppose that the market is initially at an equilibrium price of $6 and an equilibrium quantity of 40 units in the graph above. If the government decides to add a $2 per-unit tax on this good, the deadweight loss from the tax will be: 10 80 70 S1 O 60 SO Demand 0 10 20 30 40 50 60 70 80 90100arrow_forwardQuestion 1 A consultant recently provided the firm's marketing manager with this estimate of the demand and supply functions for the firm's product Qd 140-3P Q 20+2P When both equations are plotted, the resulting chart is the following Based on the information, how much social surplus does the society receive at market equilibrium? O 544 O $125 1632 816arrow_forward
- There are two consumers, Andy and Ben, in the market for pumpkins. Their willingness to pay for each pumpkin is shown in the table Pumpkin Market. There are two producers of pumpkins, Cindy and Diane, and their costs are also shown. The equilibrium price for pumpkins is $8 and the equilibrium quantity is 5. At the equilibrium price and quantity, Cindy sells pumpkins, and her producer surplus is______ Andy's Quantity of willingness to Pumpkins pay 1st pumpkin $12 2nd pumpkin 3rd pumpkin 8 4th pumpkin 6 A) four; $2 10 B) three; $81 C) two: $ D) one; $5 Ben's willingness Cindy's to pay cost $11 9 7 5 $3 00 10 Diane's cost $4 11arrow_forwardThe supply curve in a market is given by P = 10 +5.25(Q), while the demand curve is P = 102 - 36(Q). The consumer surplus and producer surplus at the equilibrium will be CSE =________ PSE =__ O A. 136.0; 17.3 OB. 89.5 13.1 O C. 96.9 15.7 O D. 136.0 23.0 O E. 113.1 17.3arrow_forwardA tax is imposed like in the figure below. This will REDUCE the producer surplus by 12 6 5 2 O24 08 18 I OI choose to use one of my three skips on this question. O 10 8 12 S+$2 tax S units.arrow_forward
- Alexis, Bruno, and Camila each want an ice-cream cone. Alexis is willing to pay $12, Bruno is willing to pay $8, and Camila is willing to pay $4. The market price is $9. Consumer surplus equals O 6 8. O 3 O 14arrow_forwardSuppose that the demand and supply functions for a good are given as follows: Demand: 0 = 600-5P Supply: 0 Suppose now that government imposes $27 tax per unit of output on sellers. What is the burden on sellers? =-300+4P O 27 12 15arrow_forwardADVANCED ANALYSIS Assume the following values for the figures below Q_{1} = 20 bags Q_{2} = 15 bags. Q_{3}; =27 bags. The market equilibrium price is $45 per bag. The price at a is $85 per bag. The price at c is $5 per bag. The price at f is $59 per bag. The price at g $31 per bag. Apply the formula for the area of a triangle (Area=1/ 2 * Base*Height) to answer the following questions.arrow_forward
- Suppose a demand curve has a vertical intercept of (0,80). Suppose a supply curve has a vertical intercept of (0,0). The equilibrium price is $30 and the dollars. equilibrium quantity is 40. The total surplus is O 800 O 1600 O 2400 O 3200arrow_forwardQ2 Given graph shows market demand and supply for Blueberries. Assume that government gives exclusive rights to certain producers to sell Blueberries and producers choose to restrict the quantity supplied to 8 million kg per year Price ($per kg.) New price Consumer surplus Social surplus DWL 351 22 O 6 J Who is worse off and who is better off? Why? es 8 15 Quantity (millions & kgs. per year) After government intervention New quantity Producer surplus How much consumer surplus is transferred to the producersarrow_forwardFigure 4-13 1Price 20 1Price 20 18 Producer A 18 Producer B S1 16 16 + 14 14 12 12 10 10 $2 8. 8 6. 6 4 4 4 6 8 10 12 14 Quantity 2 4 6 16 Quantity 16 10 12 14 Refer to Figure 4-13. If Producer A and Producer B are the only producers in the market, then the market quantity supplied when the price is $2 is Select one: O a. 8 units. O b. 4 units. 10 units. d. 6 units.arrow_forward
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