**Question:**If it costs Ben $15 worth of his time to provide a cab ride to the train station and Jill values the cab ride at $30, then if the price for a cab ride is $20, the consumer surplus is ____ and the producer surplus is ____.**Options:**- $45; $35- $10; $5- $5; $10- $15; $5**Explanation:**- **Consumer Surplus:** This is the difference between what Jill is willing to pay and the actual price she pays. Jill values the ride at $30 and pays $20, so her consumer surplus is $30 - $20 = $10.- **Producer Surplus:** This is the difference between the price Ben receives and his cost. It costs Ben $15 in time and he receives $20, so his producer surplus is $20 - $15 = $5.

Consumer surplus: - it is the difference between a consumer’s willingness to pay and the price he…

If it costs Ben $15 worth of his time to provide a cab ride to the train station and Jill values the cab ride at $30, then if the price for a cab ride is $20, the consumer surplus is the producer surplus is and $45; $35 O $10; $5 O $5; $10 $15; $5

If it costs Ben $15 worth of his time to provide a cab ride to the train station and Jill values the cab ride at $30, then if the price for a cab ride is $20, the consumer surplus is the producer surplus is and $45; $35 O $10; $5 O $5; $10 $15; $5

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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