A3 In May 1991, Car and Driver described a Jaguar that sold for 980,000 dollars. Suppose that at that price only60 have been sold. If it is estimated that 375 could have been sold if the price had been 590,000 dollars.Assuming that the demand curve is a straight line, and that 590,000 dollars and 375 are the equilibrium priceand quantity, find the consumer surplus at the equilibrium price.surplus = thousands of dollars

The objective of the question is to calculate the consumer surplus at the equilibrium price.…

Answered: In May 1991, Car and Driver described a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Supply and demand curves for a consumer item are give by q = (s(p)=500 + p and q = D(p)=2300-2p respectively p is the price in dollars for one unit of this item and q is the umber of units. The equilibrium price is ' =$600 A sales tax of 3.2% to be directed at the consumers, is under consideration. Determine the amout of money per item that supplies stand to lose due to this tax which is directed at consumers.
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