Homework Answers
Ans: Consumer surplus is a buyer's willingness to pay minus the amount the buyer actually pays. That is, consumer surplus is the area above the price and below the demand curve.
Producer surplus is the amount a seller is paid for a good minus the seller's costs. That is, producer surplus is the area below the price and above the supply curve.
Total surplus is the sum of Consumer and Producer Surplus.
Here the equilibrium price is 30 dollars per cellphone and equilibrium quantity is 100 cell phones per month.
Calculating Consumer and Producer surplus using the formula for area of a triangle= 1/2 * base * height
Here, Consumer surplus = (1/2) * (100-0) * (60-30) = 1500 dollars
Here, Producer surplus = (1/2) * (100-0) * (30-15) = 750 dollars
Therefore, Total Surplus = Consumer surplus + Producer surplus = 1500 dollars + 750 dollars = 2250 dollars
From the above found values, we can say that Producer surplus can't be $1500. Hence option e) is not correct while the rest of the statements are correct
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QUESTION 8 Consider the competitive market for cell phones in Figure 1, below. Which of the...
QUESTION 8 Consider the competitive market for cell phones in Figure 1, below. Which of the following statements...
QUESTION 8 Consider the competitive market for cell phones in Figure 1, below. Which of the following statements is NOT true: Figure 1: Market for cell phones ollars per cell phone) Figure 1. Markel lor cell phones Price (dollars per cell phone) 50 100 150 200 Quantity (cell phones per month) O a) Efficient and the total surplus equals $2250 b) Inefficient and the consumer surplus equals $1500 Quantity (cell Phones per mom a) Efficient and the total surplus equals...
Figure 1: Markel IUT CE PHONES Price (dollars per cell phone) 50 • 100 150 200 Quantity (cell phones per month) a)...
Figure 1: Markel IUT CE PHONES Price (dollars per cell phone) 50 • 100 150 200 Quantity (cell phones per month) a) Efficient and the total surplus equals $2250 b) Inefficient and the consumer surplus equals 51500
Total economic surplus. The following diagram shows supply and demand in the market for smart phones....
Total economic surplus.
The following diagram shows supply and demand in the market for
smart phones.
Use the black point (plus symbol) to indicate the equilibrium
price and quantity of smart phones. Then use the green point
(triangle symbol) to fill the area representing consumer surplus,
and use the purple point (diamond symbol) to fill the area
representing producer surplus.
Total surplus in this market is ($
)million.
150 135 Demand Equilibrium 120 105 5 90 2 75 Consumer Surplus...
Total economic surplus The following diagram shows supply and demand in the market for smartphones. Use...
Total economic surplus The following diagram shows supply and
demand in the market for smartphones. Use the black point (plus
symbol) to indicate the equilibrium price and quantity of
smartphones. Then use the green point (triangle symbol) to fill the
area representing consumer surplus, and use the purple point
(diamond symbol) to fill the area representing producer
surplus.
8. Total economic surplus The following diagram shows supply and demand in the market for smartphones. Use the black point (plus symbol)...
The perfectly competitive firm and market in the short run Consider a perfectly competitive market where...
The perfectly competitive firm and market in the short run Consider a perfectly competitive market where demand is QD = 2,000 - 40P and quantity is measured in units while price is measured in dollars per unit. The long run supply is QS = 100P - 800. a) Find the equilibrium price and the equilibrium quantity. b) When the market is in equilibrium, what is the total expenditure in this market? c) When the market is in equilibrium, what is...
8. Total economie surplus The following diagram shows supply and demand in the market for smartphones...
8. Total economie surplus The following diagram shows supply and demand in the market for smartphones Use the black point (plus symbol) to indl the equilibrium price and quantity of smartphones. Then use the green point (triangle symbol) to fill area representing consumer surplus, and use the purple point (diamond symbol) to fill the area representing producer surplus. Demand Equilibrium Consumer Surplus PRICE (Dollars per phone) Producer Surplus 0 40 320 350 400 80 120 160 200 240 280 QUANTITY (Millions of phones)...
Figure 14-8 Suppose a firm operating in a competitive market has the following cost curves: 1. Refer to Figure 14-8...
Figure 14-8 Suppose a firm operating in a competitive market has the following cost curves: 1. Refer to Figure 14-8. Which line segment best reflects the short run supply curve for this firm? a. ABCF b. CD c. DF d. BCD 24. Efficiency in a market is achieved when a. the sum of producer surplus and consumer surplus is maximized. b. a social planner intervenes and sets the quantity of output after evaluating buyers' willingness to pay and sellers' costs....
a competitive market for cell phone chargers is in equilibrium if the price temporarily falls below...
a competitive market for cell phone chargers is in equilibrium if the price temporarily falls below the equilibrium price a. the change in producer surplus is inedeterminate b. producer surpluse will rise c. there will be no change in producer surplus. d. producer surplus will fail
4. The diagram below shows supply and demand in a perfectly competitive local market for cubic...
4. The diagram below shows supply and demand in a perfectly competitive local market for cubic metres (m3) of garden soil. Price is per LLL LLD 10 20 30 40 50 60 70 NO90 100 110 120 Quantity (m' day) a. At the equilibrium market price, determine the following values: - total revenue received by sellers -consumer surplus producer surplus total economic surplus b. Now suppose that sellers in this market cooperate and restrict their total output to 30m3 per...
Question 7 1 pts Consider a perfectly competitive market. Why is the market equilibrium pareto efficient?...
Question 7 1 pts Consider a perfectly competitive market. Why is the market equilibrium pareto efficient? in this market, one can make someone better off without harming someone else. consumer surplus is maximized but producer surplus is not maximized Oproducer surplus is maximized but consumer surplus is not maximized total surplus is maximized. all of the above
QUESTION 8 Consider the competitive market for cell phones in Figure 1, below. Which of the following statements is NOT true: Figure 1: Market for cell phones ollars per cell phone) Figure 1. Markel lor cell phones Price (dollars per cell phone) 50 100 150 200 Quantity (cell phones per month) O a) Efficient and the total surplus equals $2250 b) Inefficient and the consumer surplus equals $1500 Quantity (cell Phones per mom a) Efficient and the total surplus equals...
Figure 1: Markel IUT CE PHONES Price (dollars per cell phone) 50 • 100 150 200 Quantity (cell phones per month) a) Efficient and the total surplus equals $2250 b) Inefficient and the consumer surplus equals 51500
Total economic surplus.
The following diagram shows supply and demand in the market for
smart phones.
Use the black point (plus symbol) to indicate the equilibrium
price and quantity of smart phones. Then use the green point
(triangle symbol) to fill the area representing consumer surplus,
and use the purple point (diamond symbol) to fill the area
representing producer surplus.
Total surplus in this market is ($
)million.
150 135 Demand Equilibrium 120 105 5 90 2 75 Consumer Surplus...
Total economic surplus The following diagram shows supply and
demand in the market for smartphones. Use the black point (plus
symbol) to indicate the equilibrium price and quantity of
smartphones. Then use the green point (triangle symbol) to fill the
area representing consumer surplus, and use the purple point
(diamond symbol) to fill the area representing producer
surplus.
8. Total economic surplus The following diagram shows supply and demand in the market for smartphones. Use the black point (plus symbol)...
8. Total economie surplus The following diagram shows supply and demand in the market for smartphones Use the black point (plus symbol) to indl the equilibrium price and quantity of smartphones. Then use the green point (triangle symbol) to fill area representing consumer surplus, and use the purple point (diamond symbol) to fill the area representing producer surplus. Demand Equilibrium Consumer Surplus PRICE (Dollars per phone) Producer Surplus 0 40 320 350 400 80 120 160 200 240 280 QUANTITY (Millions of phones)...
Figure 14-8 Suppose a firm operating in a competitive market has the following cost curves: 1. Refer to Figure 14-8. Which line segment best reflects the short run supply curve for this firm? a. ABCF b. CD c. DF d. BCD 24. Efficiency in a market is achieved when a. the sum of producer surplus and consumer surplus is maximized. b. a social planner intervenes and sets the quantity of output after evaluating buyers' willingness to pay and sellers' costs....
4. The diagram below shows supply and demand in a perfectly competitive local market for cubic metres (m3) of garden soil. Price is per LLL LLD 10 20 30 40 50 60 70 NO90 100 110 120 Quantity (m' day) a. At the equilibrium market price, determine the following values: - total revenue received by sellers -consumer surplus producer surplus total economic surplus b. Now suppose that sellers in this market cooperate and restrict their total output to 30m3 per...
Question 7 1 pts Consider a perfectly competitive market. Why is the market equilibrium pareto efficient? in this market, one can make someone better off without harming someone else. consumer surplus is maximized but producer surplus is not maximized Oproducer surplus is maximized but consumer surplus is not maximized total surplus is maximized. all of the above
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