Microeconomics (7th Edition)
7th Edition
ISBN: 9780134737508
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 12, Problem 12.1.9PA
To determine
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Sally runs a vegetable stand. The following table shows two points on the demand curve for the heirloom tomatoes
she sells:
Price
$3.50
$2.25
Quantity demanded per week
150,000
250,000
Sally's marginal revenue from lowering the price of tomatoes from $3.50 to $2.25 is $ 0.375. (Enter your response
rounded to two decimal places.)
Lowering the price from $3.50 to $2.25 results in an output effect of $ and a price effect of $. (Enter your
responses as whole numbers and include a minus sign if necessary.)
Chapter 16 Homework
PRICE (Thousands of dollars per fire engine)
220
Femi
200
180
160
140
120
100
80
60
40
20
0
0
True
1
False
2
4 56 7
QUANTITY (Fire engines)
3
8
Demand
9 10
increase production from 8 to 9 fire engines because the
True or False: If alternatively Femi's HookNLadder were a competitive firm and $80,000 were the market price for an engine, decreasing its price from
$80,000 to $40,000 would result in the same change in the production quantity and, thus, total revenue.
Revenue Lost
Revenue Gained
dominates in this scenario.
Attempts
Average: /3
3. The components of marginal revenue
Gilberto's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania.
Initially, Gilberto produced four fire engines, but he has decided to increase production to
five fire engines. The following graph shows the demand curve Gilberto faces. As you can
see, to sell the additional engine, Gilberto must lower his price from $105,000 to $90,000
per fire engine. Note that while Gilberto gains revenue from the additional engine he sells,
he also loses revenue from the initial four engines because he sells them all at the lower
price.
Use the purple rectangle (diamond symbols) to shade the area representing the revenue
lost from the initial four engines by selling at $90,000 rather than $105,000. Then use the
green rectangle (triangle symbols) to shade the area representing the revenue gained
from selling an additional engine at $90,000.
PRICE (Thousands of dollars per fire engine)
150
135
120
105
90
75
0
0…
Chapter 12 Solutions
Microeconomics (7th Edition)
Ch. 12 - Prob. 12.1.1RQCh. 12 - Prob. 12.1.2RQCh. 12 - Prob. 12.1.3RQCh. 12 - Prob. 12.1.4PACh. 12 - Prob. 12.1.5PACh. 12 - Prob. 12.1.6PACh. 12 - Prob. 12.1.7PACh. 12 - Prob. 12.1.8PACh. 12 - Prob. 12.1.9PACh. 12 - Prob. 12.2.1RQ
Ch. 12 - Prob. 12.2.2RQCh. 12 - Prob. 12.2.3RQCh. 12 - Prob. 12.2.4PACh. 12 - Prob. 12.2.5PACh. 12 - Prob. 12.2.6PACh. 12 - Prob. 12.2.7PACh. 12 - Prob. 12.2.8PACh. 12 - Prob. 12.3.1RQCh. 12 - Prob. 12.3.2RQCh. 12 - Prob. 12.3.3PACh. 12 - Prob. 12.3.4PACh. 12 - Prob. 12.3.5PACh. 12 - Prob. 12.3.6PACh. 12 - Prob. 12.3.7PACh. 12 - Prob. 12.3.8PACh. 12 - Prob. 12.4.1RQCh. 12 - Prob. 12.4.2RQCh. 12 - Prob. 12.4.3RQCh. 12 - Prob. 12.4.4PACh. 12 - Prob. 12.4.5PACh. 12 - Prob. 12.4.6PACh. 12 - Prob. 12.4.7PACh. 12 - Prob. 12.4.8PACh. 12 - Prob. 12.4.9PACh. 12 - Prob. 12.4.10PACh. 12 - Prob. 12.5.1RQCh. 12 - Prob. 12.5.2RQCh. 12 - Prob. 12.5.3RQCh. 12 - Prob. 12.5.4PACh. 12 - Prob. 12.5.5PACh. 12 - Prob. 12.5.6PACh. 12 - Prob. 12.5.8PACh. 12 - Prob. 12.5.9PACh. 12 - Prob. 12.5.10PACh. 12 - Prob. 12.5.11PACh. 12 - Prob. 12.5.12PACh. 12 - Prob. 12.6.1RQCh. 12 - Prob. 12.6.2RQCh. 12 - Prob. 12.6.3RQCh. 12 - Prob. 12.6.4PACh. 12 - Prob. 12.6.5PACh. 12 - Prob. 12.6.6PACh. 12 - Prob. 12.6.7PACh. 12 - Prob. 12.6.8PACh. 12 - Prob. 12.6.9PACh. 12 - Prob. 12.6.10PACh. 12 - Prob. 12.1CTECh. 12 - Prob. 12.2CTECh. 12 - Prob. 12.3CTE
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