In the market for a particular pair of sunglasses, Eboni is willing to pay $90 for a pair while Alexa is willing to pay $110 for a pair. The actual price that each has to pay for a pair of sunglasses is $45. What is the combined amount of consumer surplus of Eboni and Alexa?
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- The State government is considering building a new highway. Linda lives near the proposed highway. Her demand for trips per month is given by Q = 60 - 0.5P, where Q is the number of trips and P is the average cost per trip in cents. The current average cost per trip is 60 cents, and the new highway is expected to reduce it to 40 cents. A legislator asks Linda how much she is willing to pay per month for the construction of the new highway. Linda: I am making 30 trips now when it costs me $0.60 per trip. With the new highway, the cost will be reduced to $0.40, so I am willing to pay up to 30 (0.6 - 0.4) = $6 per month. Do you agree with her reasoning?Suppose Rajiv is the only seller in the market for bottled water and Kevin is the only buyer. The following lists show the value Kevin places on a bottle of water and the cost Rajiv incurs to produce each bottle of water: Kevin's Value Value of first bottle: $10 Value of second bottle: $7 Value of third bottle: $3 Value of fourth bottle: $1 The following table shows their respective supply and demand schedules: Price $1 or less $1 to $3 $3 to $7 $7 to $10 More than $10 Quantity Demanded Quantity Supplied 4 3 2 1 0 0 1 2 3 Cost of first bottle: $1 Cost of second bottle: $3 Cost of third bottle: $7 Cost of fourth bottle: $10 4 Rajiv's Costs Use Rajiv's supply schedule and Kevin's demand schedule to find the quantity supplied and quantity demanded at prices of $2, $6, and $9. Enter these values in the following table.if the price fall from p0 to p1, the change in consumer surplus is equal to what area?
- Rhea's inverse demand for a good is given by p = 15.00 - (1.00 × q). Assuming that there are enough suppliers to meet her demand, if the per-unit price increases from p = 3.50 to p = 7.50, what is the absolute value of her change in consumer's surplus? (Round to the nearest two decimals.)Torsten's Marginal Willingness to Pay (MWTP) for flour is given in the table below. If the price of flour falls from $32 to $25, what is the change in Torsten's surplus? Flour can be bought in integer values only. Enter a number only, drop the $ sign. Include a negative sign if surplus decreases. Bags of flour MWTP 1 $48 2 $41 3 $38 4 $27 5 $16 6 $14 7 $7Consider the market for computers. The current price of dell computer is $1200.00. Two consumers, Jeff and Peter, are willing to 1,250 and 1,350, for a new computer. Two electronic stores are willing to sell the dell computers for as little as 1,150 and 1,000 each. What's the total surplus in this market?
- Suppose that the government has a goal to reduce the demand for cigarettes in support of a health program. Given this, the government decided to impose a per-unit tax of 40 centavos per pack that is levied on the sellers or placed on the sale of cigarettes by the government. This causes a shift of the market supply of cigarettes from S to S' as shown. Price ($ per pack) S 1.50 1.40 1.30 1.15 D₂ Quantity (Millions of pack) 3 4 5 Answer the following questions regarding this case. 1. Determine the deadweight loss to society caused by the imposition of the tax. (3 points) Interpret the result. (3 points) 1 2. What tax revenue is expected to be collected by the government? (4 points) 1.25 + 1 1 D₁Colorado. The Mead market price of a motor scooter is given by the horizontal black line at $60. Each rectangle you can place on the following graph corresponds to a particular buyer in this market: orange (square symbols) for Bob, green (triangle symbols) for Cho, purple (diamond symbols) for Eric, tan (dash symbols) for Ginny, and blue (circle symbols) for Kenji. Use the rectangles to shade the areas representing consumer surplus for each person who is willing and able to purchase a motor scooter at a market price of $60. (Note: If a person will not purchase a motor scooter at the market price, indicate this by leaving his or her rectangle in its original position on the palette.) ? PRICE (Dollars per motor scooter) 160 140 120 100 80 60 40 20 0 0 1 Bob 2 Cho Eric Ginny Kenji 3 4 5 QUANTITY (Motor scooters) Market Price 6 7 8 Based on the information on the previous graph, you can tell that consumer surplus in this market will be $ Bob Cho Eric Ginny Kenji will buy motor scooters at…You are a math tutor, and you offer in-home tutoring on weekday afternoons for $20 an hour. On Saturdays, you tutor students hourly for free at the community center. Since you follow the Rational Rule for Consumers, which statement can you conclude is TRUE? Your economic surplus rises or at least remains unchanged when you tutor at the community center. You couldn't gain any economic surplus from tutoring at the community center since you earn $0 per hour. You can't compare the two types of tutoring because you can't quantify how much donating your time means to you. O The time you spend tutoring the students on weekday afternoons lowers your economic surplus.
- The demand side of the market for Sprite is comprised of 2 people. These people are William and Owen. P represents the price of 1 gallon of Sprite, and Qd represents the quantity demanded of Sprite in gallons. William's demand for Sprite is modeled by the equation QdW = 10 - 2P Owen's inverse demand for Sprite is modeled by the equation P = 10 - 2QdO (Part I) With this information, draw the market demand graph. Please label the graph for slope values, intercepts, kinks, etc. (Part II) The market supply is modeled by P = Qs. Let's say that the government places a subsidy of $8 (s = 8). As a result, what is the market equilibrium with this intervention of the government (Q**, PD**, and PS**)? (Part III) Please draw the market demand and market supply on a new graph and indicate/label the market equilibrium with the government intervention through a subsidy. Label the graph for slopes, subsidy, equilibrium points, etc.You are considering buying a monthly metro pass for the subway at $150 or paying $4 per ride. Your monthly demand curve is P = 60 - 2Q where Q is the number of rides per month. Given this information, your consumer surplus will be $750 buying each ride and $900 with the monthly pass. $600 buying each ride and $700 with the monthly pass. $784 buying each ride and $900 with the monthly pass. $784 buying each ride and $750 with the monthly pass.The attached figure shows Rosa's demand for ice cream. If the price of ice cream were $2 per litre, then Rosa's consumer surplus for the 4th litre: (a) Is greater than the surplus for the 8th litre. b) Is the same as the surplus on the 8th litre. c) Is less than the surplus on the 8th litre d) It could be greater than, equal to or less than the surplus of the 8th litre. Note: Please make your calculations to get the correct answer