Attempts Keep the Highest / 4 5. Problems and Applications Q5 Brian owns a water pump. Because pumping large amounts of water is harder than pumping small amounts, the cost of producing a bottle of water rises as he pumps more. Here is the cost he incurs to produce each bottle of water: Cost of first bottle: $1 Cost of second bottle: $4 Cost of third bottle: $7 Cost of fourth bottle: $9 From this information, complete the following table by deriving Brian's supply schedule. Price More than $9 Quantity Supplied $7 to $9 $4 to $7 $1 to $4 $1 or less Based on Brian's willingness to sell, plot his supply curve as a step function on the following graph using the orange points (square symbol). Be sure to plot your first point at (0, 0). Price of Water 3 2 1 10 9 8 7 0 2 3 Quantity of Water Suppose the price of a bottle of water is $5. Brian's Supply Price $5 Quantity Sold Producer Surplus Use the black line (plus symbol) to draw a price line at $5. Next use the grey point (star symbol) to indicate how many bottles of water Brian will produce and sell at that price. Finally, use the purple point (diamond symbol) to shade the area that represents Brian's producer surplus. In this case, Brian receives [ in producer surplus from his water sales. If the price rises to $8, Brian now sells bottles of water. This his producer surplus to S
Attempts Keep the Highest / 4 5. Problems and Applications Q5 Brian owns a water pump. Because pumping large amounts of water is harder than pumping small amounts, the cost of producing a bottle of water rises as he pumps more. Here is the cost he incurs to produce each bottle of water: Cost of first bottle: $1 Cost of second bottle: $4 Cost of third bottle: $7 Cost of fourth bottle: $9 From this information, complete the following table by deriving Brian's supply schedule. Price More than $9 Quantity Supplied $7 to $9 $4 to $7 $1 to $4 $1 or less Based on Brian's willingness to sell, plot his supply curve as a step function on the following graph using the orange points (square symbol). Be sure to plot your first point at (0, 0). Price of Water 3 2 1 10 9 8 7 0 2 3 Quantity of Water Suppose the price of a bottle of water is $5. Brian's Supply Price $5 Quantity Sold Producer Surplus Use the black line (plus symbol) to draw a price line at $5. Next use the grey point (star symbol) to indicate how many bottles of water Brian will produce and sell at that price. Finally, use the purple point (diamond symbol) to shade the area that represents Brian's producer surplus. In this case, Brian receives [ in producer surplus from his water sales. If the price rises to $8, Brian now sells bottles of water. This his producer surplus to S
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Attempts
Keep the Highest / 4
5. Problems and Applications Q5
Brian owns a water pump. Because pumping large amounts of water is harder than pumping small amounts, the cost of producing a bottle of water
rises as he pumps more. Here is the cost he incurs to produce each bottle of water:
Cost of first bottle: $1
Cost of second bottle: $4
Cost of third bottle: $7
Cost of fourth bottle: $9
From this information, complete the following table by deriving Brian's supply schedule.
Price
More than $9
Quantity Supplied
$7 to $9
$4 to $7
$1 to $4
$1 or less
Based on Brian's willingness to sell, plot his supply curve as a step function on the following graph using the orange points (square symbol). Be sure
to plot your first point at (0, 0).
Price of Water
3
2
1
10
9
8
7
0
2
3
Quantity of Water
Suppose the price of a bottle of water is $5.
Brian's Supply
Price $5
Quantity Sold
Producer Surplus
Use the black line (plus symbol) to draw a price line at $5. Next use the grey point (star symbol) to indicate how many bottles of water Brian will
produce and sell at that price. Finally, use the purple point (diamond symbol) to shade the area that represents Brian's producer surplus.
In this case, Brian receives [
in producer surplus from his water sales.
If the price rises to $8, Brian now sells
bottles of water. This
his producer surplus to S
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