Answer: b) $900
..
Consumer surplus (CS) = Willingness to pay - Price actually paid.
willingness to pay is the same as the value of the product.
So value of the product = Consumer surplus + Price paid
Price paid = $500, CS = $400
So Nathan values the sound system at ($500 + $400) = $900
Nathan buys a new sound system for his dorm room for $500. He receives consumer surplus...
As Mitch was walking home from college to his dorm room, he was suddenly confronted by three thugs on bikes, Alvin, Simon and Theodore. The thugs wanted to steal Mitch's backpack but in the ensuing altercation, Mitch was not only able to keep his backpack but stole all three bikes from Alvin, Simon and Theodore who ran off on foot never to be seen again on campus. Mitch went straight home and looked up the values of the bikes on...
Demand Curve & Consumer Surplus. Assume the $Price for Puppies is $200. 1. What is the buyer’s optimal (best) quantity demanded, Qd? 2. What Area shows buyer’s net gain or ‘Consumer Surplus’? 3. What Area shows buyer’s Total Dollar Value (Total Willingness to Pay)? 4. What Area shows buyer’s Total Expenditures (spending on good)? 5. Number example of Consumer Surplus: Lara wants to buy a new Surf board. She is willing to spend $650 maximum. The Price of one she...
Public Goods: Four roommates are planning to spend the weekend in their dorm room watching pay per view movies, and they are debating how many to watch. The following gives their willingness to pay (marginal benefit) for each film: Ang Greta Shonda J.J. First film $8 $5 $4 $2 Second film $6 $4 $2 $1 Third film $5 $3 $1 $0 Fourth film $1 $2 $0 $0 Fifth film $0 $1 $0 $0 Anyone in the room is able to...
Four roommates are planning to spend the weekend in their dorm room watching old movies, and they are debating how many to watch. Here is their willingness to pay for each film: Willingness to Pay (Dollars) Eric Kenji Paolo Van First film 10 9 8 3 Second film 8 7 6 2 Third film 6 5 4 1 Fourth film 4 3 2 0 Fifth film 2 1 0 0 Within the dorm room, the showing of a movie (...
5. Problems and Applications Q5 Four roommates are planning to spend the weekend in their dorm room watching old movies, and they are debating how many to watch. Here is their willingness to pay for each film: Willingness to Pay (Dollars) Kevin Rajiv Yakov Charles First film 10 9 6 3 Second film 9 7 4 2 Third film 8 5 2 1 Fourth film 7 3 0 0 Fifth film 6 1 0 0 Within the dorm room, the...
Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael's willingness to pay is a. $3,500 b. $6,500 C. $3,000 d. $500 Question Completion Status: > A Moving to another question will save this response. Question 15 Hot dogs and hot dog buns are complements. An increase in the price of flour used to make hot dogs buns a. increase consumer surplus in the market for hot dog buns...
NEED HELP WITH THIS ASAP !!!! PLEASEEEEE $700 $600 $500 $400 $300 $200 $100 D, $Value 0 10 20 30 40 50 60 70 80 90Qd Use Demand graph above to answer Qns. 1 -4. Assume the $Price for Puppies is$200 1. What is the buyer's optimal (best) quantity demanded, Qd? 2. What Area shows buyer's net gain or 'Consumer Surplus'? 3. What Area shows buyer's Total Dollar Value (Total Willingness to Pay)? 4. What Area shows buyer's Total Expenditures...
1. Tina walks into Ted's sporting goods store and buys a punching bag for $100. That $100 payment counts as for Tina and for Ted. L07.1 a. Income; expenditure. b. Value added; multiple counting. C. Expenditure; income. i. Rents, profits. 3. Which of the following transactions would count in GOP? LO7.1 Select one or more answers from the choices shown. 2. Kerry buys a new sweater to wear this winter. b. Patricia receives a Social Security check. C. Roberto gives...
2. Total and marginal utility Yakov enjoys drinking milk, since his mother tells him it will make him grow up strong. The following table contains information on Yakov's utility from milk each day. FW in the two missing cells of the table. Milk (Glasses) Total Utility (Utils) Marginal Utility (Utils per glass) 200 210 On the following graph, use the purple points (diamonds symbol) to plat Yakov's total utility (TU) curve if he consumes zero, one, two, three, four, five,...
Dave Hirsh publishes his own manuscripts and is unsure which of two new printers he should purchase. He is a novelist living in Parkman, Illinois. Having slept through most of his Finance 300 course in college, he is unfamiliar with cash flow analysis. He enlists the help of the finance professor at the local university, Dr. Gwen French, to assist him. Together they estimate the following expected initial investment (a negative cash flow) and net positive cash flows for years...