Question

8) 8) If the quantity of sunglasses supplied is represented by the equation O .-60 + 4P then the corresponding price of sunglasses is represented by the equation A) P - 150$240 B) P=0.250$ +15. C) P=OS - 7.5. D) P = 12 -0.40%. Table 4-6 Demand P = 80-OD QD80- P Supply P=50 +1/2 OS -2P - 100 S 9) Refer to Table 4-6. The equations above describe the demand and supply for Chef Emnie's Sushi-on-a-Stick. What are the equilibrium price and quantity (in thousands) for Chef Emnie's Sushi? A) $40 and 50 thousand B) $80 and 80 thousand C) $60 and 20 thousand D) $50 and 100 thousand 10) Refer to Table 4-6. The equations above describe the demand and supply for Chef Emnie's Sushi-on-a-Stick. The equilibrium price and quantity for Chef Emnie's sushi are $60 and 20 thousand units. What is the value of consumer surplus? A) $100 thousand B) $200 thousand C) $600 thousand D) $800 thousand

Answer 1

(8) (B)

QS = - 60 + 4P

4P = QS + 60

P = 0.25QS + 15

(9) (C)

In equilibrium, QD = QS.

80 - P = 2P - 100

3P = 180

P = 60

Q = 80 - 60 = 20

(10) (B)

When QD = 0, P = 80

Consumer surplus ($'000) = (1/2) x (80 - 60) x 20 = 10 x 20 = 200