It is a hot day and Bert is thirsty. Here is the value he places on a bottle of water:Bottle of WaterValueValue of first bottle$7Value of second bottle$5Value of third bottle$3Value of fourth bottle$1 From this information, derive Bert’s demand schedule.Graph his demand curve for bottled water.If the price of a bottle of water is $4, how many bottles does Bert buy? How much consumer surplus does Bert get from his purchases? Show Bert’s consumer surplus in your graph.If the price falls to $2, how does quantity demand change? How does Bert’s consumer surplus change? Show these changes in your graph.

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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It is a hot day and Bert is thirsty. Here is the value he places on a bottle of water:

Bottle of Water	Value
Value of first bottle	$7
Value of second bottle	$5
Value of third bottle	$3
Value of fourth bottle	$1

From this information, derive Bert’s demand schedule.
Graph his demand curve for bottled water.
If the price of a bottle of water is $4, how many bottles does Bert buy? How much consumer surplus does Bert get from his purchases? Show Bert’s consumer surplus in your graph.
If the price falls to $2, how does quantity demand change? How does Bert’s consumer surplus change? Show these changes in your graph.

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