Joe's demand for spring water can be represented as p = 11 - 0.6Q (where p...
Joe's demand for spring water can be represented as p = 11 - 0.6Q (where p is measured in $/ gallon and Q is measured in gallons). He recently discovered a spring where water can be obtained free of charge. His consumer surplus from this water is
Homework Answers
Consumer surplus is the area of the region above the equilibrium price level and below the demand curve.
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Joe's demand for spring water can be represented as p = 11 -
0.6Q (where p...
68. Joe's demand for spring water can be represented as p 10 Q (where p is measured in $/gallon and Q is measured in...
68. Joe's demand for spring water can be represented as p 10 Q (where p is measured in $/gallon and Q is measured in gallons). He recently discovered a spring where water can be obtained free of charge. His consumer surplus from this water is O A. $0. O B. $100. O C. $50. O D. unknown based upon the information provided. Assume a consumer has a horizontal demand curve for a product. His consumer surplus from buying the product...
Let weekly demand for tankers of water to a small village be represented by the following...
Let weekly demand for tankers of water to a small village be represented by the following demand curve: P = 160 – 20Q And suppose that HydroTank is the monopoly supplier of water to the village with a marginal cost curve: MC = 40 + 20Q; a) On a clearly labeled diagram, sketch the demand, marginal revenue, and marginal cost curves and calculate and show the monopolist’s profit-maximising quantity(QM) and the price that will be charged in the market (PM)....
The inverse demand and supply curves for wheat are given by: P= 11-Q^d and P=1 +...
The inverse demand and supply curves for wheat are given by: P= 11-Q^d and P=1 + Q^s, where P is the price of wheat in dollars per bushel (USD/bu) and Q is the quantity of wheat in million bushels (mil bu), The price support set by the government is equal to $8/bu. Calculate the changes in producer and consumer surplus for the price support policy. Who is made better off, who worse off, and by how much?
Question 1 (10 pts) Consider the following market. Demand is given by Qp 5-P where Qp...
Question 1 (10 pts) Consider the following market. Demand is given by Qp 5-P where Qp is the quantity demand and p is the price. Supply is given by Qs - F where Qs is the quantity supplied. a. What is the market equilibrium quantity and price? b. Calculate consumer, producer, and total surplus. Depict your answer in a graph. c. Suppose the government imposes a price floor of P- 4. Calculate the consumer surplus, producer surplus, and deadweight loss....
4. Suppose 1,000 identical suppliers of bottled water operate in a perfectly competitive market. The market...
4. Suppose 1,000 identical suppliers of bottled water operate in a perfectly competitive market. The market demand for their water is given by the equation: Q-10,000-200P, or P-50-.005Q where Q is the number of gallons of water demanded each day by consumers of bottled water, and Pis the price per gallon a. If the marginal cost to each supplier was constant at $I per gallon, how many gallons of water would sell in this market? How many would each supplier...
5. The demand curve for chocolate can be represented by Q = 1,000-20P, where P is...
5. The demand curve for chocolate can be represented by Q = 1,000-20P, where P is the price per pound (in U.S. dollars), and the quantity Q is expressed in pounds per year. The private marginal cost of production in the chocolate industry is given by Q/20. a. (4 points) Assuming that the market for chocolate is competitive, what will be the equilibrium outcome? Please include a graph. b. (10 points) Chocolate production causes a nauseating odor to sweep over...
2. Consumer surplus for an individual and a market The following graph shows Jacques's weekly demand...
2. Consumer surplus for an individual and a market The following graph shows Jacques's weekly demand for cheesecake, represented by the blue line. Point A represents a point along his weekly demand curve. The market price of cheesecake is $1.25 per slice, as shown by the horizontal black line. Jacques's Weekly Demand 2.50 Demand 2.25 2.00 1 75 1.50 Price 1 25 1,00 0.75 0.50 0 25 0 2468 101214 16 18 20 QUANTITY (Slices of cheesecake) for his 8th...
1.) The following relations describe monthly demand and supply for a wheat where P is the...
1.) The following relations describe monthly demand and supply
for a wheat
where P is the price (in cents) per pound and Q is the quantity
(in millions) of pounds.
Suppose government passes a regulation which makes it illegal
for buyers to buy at a price lower than 60 cents per pound.
a.) What is the prevailing price and quantity traded after the
regulation?
b.) Does the price floor create any surplus or shortage in
market? Why or why not?...
Suppose a monopolist faces consumer demand given by P 400-5Q with a constant marginal cost of $20 per unit (where margi...
Suppose a monopolist faces consumer demand given by P 400-5Q with a constant marginal cost of $20 per unit (where marginal cost equals average total cost. assume the firm has no fixed costs) If the monopoly can only charge a single price, then it will earn profits of S(Enter your response rounded as a whole number.) Correspondingly, consumer surplus is S However, if the firm were to practice price discrimination such that consumer surplus becomes profit, then, holding output constant...
Sal's satellite company broadcasts TV to subscribers in Los Angeles and New York. The demand functions for each of thes...
Sal's satellite company broadcasts TV to subscribers in Los Angeles and New York. The demand functions for each of these two groups are: QNY = 70 -0.25PNY QLA = 110-0.5PLA where Q is in thousands of subscriptions per year and P is the subscription price per year. The cost of providing Q units of service is given by C = 1000 + 40Q where Q = QNY +QLA a. What are the profit-maximizing prices and quantities for the New York...
68. Joe's demand for spring water can be represented as p 10 Q (where p is measured in $/gallon and Q is measured in gallons). He recently discovered a spring where water can be obtained free of charge. His consumer surplus from this water is O A. $0. O B. $100. O C. $50. O D. unknown based upon the information provided. Assume a consumer has a horizontal demand curve for a product. His consumer surplus from buying the product...
Question 1 (10 pts) Consider the following market. Demand is given by Qp 5-P where Qp is the quantity demand and p is the price. Supply is given by Qs - F where Qs is the quantity supplied. a. What is the market equilibrium quantity and price? b. Calculate consumer, producer, and total surplus. Depict your answer in a graph. c. Suppose the government imposes a price floor of P- 4. Calculate the consumer surplus, producer surplus, and deadweight loss....
4. Suppose 1,000 identical suppliers of bottled water operate in a perfectly competitive market. The market demand for their water is given by the equation: Q-10,000-200P, or P-50-.005Q where Q is the number of gallons of water demanded each day by consumers of bottled water, and Pis the price per gallon a. If the marginal cost to each supplier was constant at $I per gallon, how many gallons of water would sell in this market? How many would each supplier...
2. Consumer surplus for an individual and a market The following graph shows Jacques's weekly demand for cheesecake, represented by the blue line. Point A represents a point along his weekly demand curve. The market price of cheesecake is $1.25 per slice, as shown by the horizontal black line. Jacques's Weekly Demand 2.50 Demand 2.25 2.00 1 75 1.50 Price 1 25 1,00 0.75 0.50 0 25 0 2468 101214 16 18 20 QUANTITY (Slices of cheesecake) for his 8th...
1.) The following relations describe monthly demand and supply
for a wheat
where P is the price (in cents) per pound and Q is the quantity
(in millions) of pounds.
Suppose government passes a regulation which makes it illegal
for buyers to buy at a price lower than 60 cents per pound.
a.) What is the prevailing price and quantity traded after the
regulation?
b.) Does the price floor create any surplus or shortage in
market? Why or why not?...
Suppose a monopolist faces consumer demand given by P 400-5Q with a constant marginal cost of $20 per unit (where marginal cost equals average total cost. assume the firm has no fixed costs) If the monopoly can only charge a single price, then it will earn profits of S(Enter your response rounded as a whole number.) Correspondingly, consumer surplus is S However, if the firm were to practice price discrimination such that consumer surplus becomes profit, then, holding output constant...
Sal's satellite company broadcasts TV to subscribers in Los Angeles and New York. The demand functions for each of these two groups are: QNY = 70 -0.25PNY QLA = 110-0.5PLA where Q is in thousands of subscriptions per year and P is the subscription price per year. The cost of providing Q units of service is given by C = 1000 + 40Q where Q = QNY +QLA a. What are the profit-maximizing prices and quantities for the New York...
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