Consider a buyer and a seller meeting to exchange a product. The seller has a minimum willing to sell ( WTS) of $39.50, while the buyer has a maximum willingness to pay ( WTP) of $87.00. If theyagree on the price ( P) of $69.80, then the total surplus is $PWTSWTP102030405060708090O A. 56.75O B. 47.50O C. 17.20O D. 4130

Total surplus = Maximum willingness to pay - Agreed price = $87 - $69.80 = $17.20

Answered: onsider a buyer and a seller pue gree…

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onsider a buyer and a seller pue gree on the price ( P) of $69.8

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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Question

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Consider a buyer and a seller meeting to exchange a product. The seller has a minimum willing to sell ( WTS) of $39.50, while the buyer has a maximum willingness to pay ( WTP) of $87.00. If they
agree on the price ( P) of $69.80, then the total surplus is $
P
WTS
WTP
10
20
30
40
50
60
70
80
90
O A. 56.75
O B. 47.50
O C. 17.20
O D. 4130

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