Consider two people in the market for tilapia, Reagan and Cheryl. The marginal benefit curves for both individuals are shown in the accompanying graph. a. Suppose the market price of tilapia is $2.00 per pound. Move point A to Cheryl’s quantity purchased. Move point B to Reagan’s quantity purchased. b. How many pounds of tilapia do they collectively purchase? _________ pounds c. To achieve an efficient allocation, Cheryl should purchase _______(more tilapia than, the same amount of tilapia as, less tilapia than) she is currently purchasing, and Reagan should purchase ________ (more tilapia than, the same amount of tilapia as, less tilapia than) she is currently purchasing.

Consider two people in the market for tilapia, Reagan and Cheryl. The marginal benefit curves for both individuals are shown in the accompanying graph. a. Suppose the market price of tilapia is $2.00 per pound. Move point A to Cheryl’s quantity purchased. Move point B to Reagan’s quantity purchased. b. How many pounds of tilapia do they collectively purchase? _____ pounds c. To achieve an efficient allocation, Cheryl should purchase _(more tilapia than, the same amount of tilapia as, less tilapia than) she is currently purchasing, and Reagan should purchase ______ (more tilapia than, the same amount of tilapia as, less tilapia than) she is currently purchasing.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter2: Choice In A World Of Scarcity

Section: Chapter Questions

Problem 25P: If the price of a pie is 12, what is the maximum number of pies she could buy in a week?

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Question

Consider two people in the market for tilapia, Reagan and Cheryl. The marginal benefit curves for both individuals are shown in the accompanying graph.

a. Suppose the market price of tilapia is $2.00 per pound. Move point A to Cheryl’s quantity purchased. Move point B to Reagan’s quantity purchased.

b. How many pounds of tilapia do they collectively purchase?

_________ pounds

c. To achieve an efficient allocation, Cheryl should purchase _______(more tilapia than, the same amount of tilapia as, less tilapia than)

she is currently purchasing, and Reagan should purchase ________ (more tilapia than, the same amount of tilapia as, less tilapia than) she is currently purchasing.

4.0
B
3.5
3.0
2.5
2.0
1.5
Cheryl's marginal benefit
1.0
0.5
Reagan's marginal benefit
0.0
2
3
4
5
7
8.
Quantity (pounds)
$ per pound

Defintion Defintion Curve that represents the graphical relationship between the total supply of goods and services and the price level in the economy. When the price level increases, producers tend to supply more of a product in the market to earn a higher revenue or vice versa.

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