Answered: he following graph shows Musashi's…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The following graph shows Musashi's weekly demand for cheesecake, represented by the blue line. Point A represents a point along his weekly demand curve. The market price of cheesecake is $3.00 per slice, as shown by the horizontal black line.

From the previous graph, you can tell that Musashi is willing to pay _____ for his 8th slice of cheesecake each week. Because he has to pay only $3.00 per slice, the consumer surplus he gains from the 8th slice of cheesecake is ________.

Suppose the price of cheesecake were to fall to $2.25 per slice. At this lower price, Musashi would receive a consumer surplus of ______ from the 8th slice of cheesecake he buys.

(Find answers by using graph)

1. Consumer surplus for an individual and a market
The following graph shows Musashi's weekly demand for cheesecake, represented by the blue line. Polnt A represents a polnt along his weekly
demand curve. The market price of cheesecake Is $3.00 per slice, as shown by the horizontal black line.
Musashi's Wookly Damand
7.50
6.75
6.00
5.25
Damand
4.50 +
3.75
Prica
3.00
2.25
1.50
0.75
2
4
10
12
14
16
18
20
QUANTITY (Slicas of choasocaka)
From the prevlous graph, you can tell that Musashi is willing to pay $
$3.00 per slice, the consumer surplus he galns from the sth slice of cheesecake is $
for his 8th slice of cheesecake each week. Because he has to pay only
Suppose the price of cheesecake were to fall to $2.25 per slice. At this lower price, Musashi would recelve a consumer surplus of $
from the
sth slice of cheesecake he buys.
PRICE (Dallars par slice)

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