Consider the market for antique cars. The market price of each antique car is $180,000, and each buyer demands no more than one antique car. Suppose that Alex is the only consumer in the antique car market. His willingness to pay for an antique car is $315,000. Based on Alex's willingness to pay, the following graph shows his demand curve for antique cars. Shade the area representing Alex's consumer surplus using the green rectangle (triangle symbols). PRICE (Thousands of dollars) 360 315 PRICE (Thousands of dollars) 270 225 180 135 90 45 0 360 315 270 225 180 135 Now, suppose another buyer, Becky, enters the market for antique cars, and her willingness to pay is $225,000. 90 0 Based on Becky's and Alex's respective willingness to pay, plot the market demand curve on the following graph using the blue points (circle symbol Next, shade Alex's consumer surplus using the green rectangle (triangle symbols), and shade Becky's consumer surplus using the purple rectangle (diamond symbols). Note: Plot your points as a step function in the order in which you would like them connected. Line segments will connect the points automatically. 45 0 1 0 Alex's Demand 2 3 QUANTITY (Antique cars) 1 Market Price 4 2 3 QUANTITY (Antique cars) 5 Alex's Consumer Surplus Market Price 5 (?) Demand Curve Alex's Consumer Surplus Becky's Consumer Surplus. (?
Consider the market for antique cars. The market price of each antique car is $180,000, and each buyer demands no more than one antique car. Suppose that Alex is the only consumer in the antique car market. His willingness to pay for an antique car is $315,000. Based on Alex's willingness to pay, the following graph shows his demand curve for antique cars. Shade the area representing Alex's consumer surplus using the green rectangle (triangle symbols). PRICE (Thousands of dollars) 360 315 PRICE (Thousands of dollars) 270 225 180 135 90 45 0 360 315 270 225 180 135 Now, suppose another buyer, Becky, enters the market for antique cars, and her willingness to pay is $225,000. 90 0 Based on Becky's and Alex's respective willingness to pay, plot the market demand curve on the following graph using the blue points (circle symbol Next, shade Alex's consumer surplus using the green rectangle (triangle symbols), and shade Becky's consumer surplus using the purple rectangle (diamond symbols). Note: Plot your points as a step function in the order in which you would like them connected. Line segments will connect the points automatically. 45 0 1 0 Alex's Demand 2 3 QUANTITY (Antique cars) 1 Market Price 4 2 3 QUANTITY (Antique cars) 5 Alex's Consumer Surplus Market Price 5 (?) Demand Curve Alex's Consumer Surplus Becky's Consumer Surplus. (?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
2. Individual
===>Please give me proper explanation
Note:-
Do not provide handwritten solution. Maintain accuracy and quality in your answer.
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Transcribed Image Text:Suppose Clancy is willing to pay a total of $135,000 for an antique car.
True or False: Keeping his maximum willingness to pay for an antique car in mind, Clancy will not buy the antique car because it would be worth less
to him than its market price of $180,000.
OO
True
False
Transcribed Image Text:Consider
the market for antique cars. The market price of each antique car is $180,000, and each buyer demands no more than one antique car.
Suppose that Alex is the only consumer in the antique car market. His willingness to pay for an antique car is $315,000. Based on Alex's willingness to
pay, the following graph shows his demand curve for antique cars.
Shade the area representing Alex's consumer surplus using the green rectangle (triangle symbols).
PRICE (Thousands of dollars)
360
315
270
PRICE (Thousands of dollars)
225
180
135
90
45
0
360
315
270
225
Now, suppose another buyer, Becky, enters the market for antique cars, and her willingness to pay is $225,000.
180
Based on Becky's and Alex's respective willingness to pay, plot the market demand curve on the following graph using the blue points (circle symbol).
Next, shade Alex's consumer surplus using the green rectangle (triangle symbols), and shade Becky's consumer surplus using the purple rectangle
(diamond symbols).
135
0
Note: Plot your points as a step function in the order in which you would like them connected. Line segments will connect the points automatically.
90
45
0
Alex's Demand
2
3
QUANTITY (Antique cars)
0
1
Market Price
4
2
3
QUANTITY (Antique cars)
5
Market Price
Alex's Consumer Surplus
4
(?
5
Demand Curve
Alex's Consumer Surplus
Becky's Consumer Surplus
(?
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