Last year the average price for an airline ticket was $400, but the average price dropped to $350 this year due to a decrease in the demand for airplane travel due to Covid. The accompanying table contains information on the supply of air travel.Airfare (price per ticket)Quantity supplied (millions of seats)$00$175350$350700$400800$5751150$7501500a) Draw the supply curve.b) Based on the above, what was the producer surplus last year? And what is the producer surplus this year? (show your calculations)c) How did the producer surplus change?

The supply curve is the curve that shows the positive or direct relationship between the price of a…

Answered: Last year the average price for an…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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Last year the average price for an airline ticket was $400, but the average price dropped to $350 this year due to a decrease in the demand for airplane travel due to Covid. The accompanying table contains information on the supply of air travel.

Airfare (price per ticket)	Quantity supplied (millions of seats)
$0	0
$175	350
$350	700
$400	800
$575	1150
$750	1500

a) Draw the supply curve.

b) Based on the above, what was the producer surplus last year? And what is the producer surplus this year? (show your calculations)

c) How did the producer surplus change?

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