Homework Answers
c) DWL = 1/2 x base x height = 1/2 x (35 - 20) x (4.5 - 3) = 11.25
d) Consumer surplus = 1/2 x 3 x (50 - 35) = 1.5 x 15 = 22.5
e) Loss in consumer surplus = 3(35 - 27.5) + 1/2 x (35 - 27.5)(4.5 - 3) = 22.5 + 5.625 = 28.12
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Help! Based on this data, what are c). d). and e). 20 Problem 14-8 The figure...
In some cities, Uber has a monopoly on ride-sharing services. In one town, the demand curve...
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Problem Setup
Analyze each of the following three scenarios (Efficient, A, and
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(aggregate)
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2Q.
Efficient Outcome
● Use the marginal benefit and marginal cost equations given
above to determine the efficient quantity
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Problem Setup
Analyze each of the following three scenarios (Efficient, A, and
B) describing the market for widgets.
Consider the market for widgets. Consumers have a market
(aggregate)
marginal benefit curve of MB = 50 – 3Q. The supplier(s) in that
market have a market (aggregate) marginal cost curve of MC = 10 +
2Q.
Efficient Outcome
● Use the marginal benefit and marginal cost equations given
above to determine the efficient quantity
Equilibrium with Marginal Cost Pricing (Scenario
A)...
The graph on the right shows the demand, marginal revenue, marginal cost, and average total cost curves for a monopolist. Show the impact if this firm was regulated to charge the fair-returns price? On graph 2: 1.) Using the point drawing tool, place a point at the output and price combination that would result from regulation if the monopoly was required to charge the fair-returns price. 2.) Using the triangle drawing tool, indicate the deadweight loss that would result from...
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