Refer to Question #1: Using the image presented on the worksheet, the producer surplus is $_____. Do not forget to round to two decimal places, input the decimal point and two places to the right of the decimal point, and place a comma, if needed. Use this image to answer the following (independent) questions:![Image of a graph]The graph shows price (P) on the vertical axis and quantity (Q) on the horizontal axis. There are supply (S) and demand (D) curves, with prices labeled at $90, $75, $50, $25, and $10, and quantities at 200, 500, and 800.1. In the space below, calculate consumer surplus (CS), producer surplus (PS), and total surplus (TS), assuming this market is efficient. (Use your Economics Rubric)2. Using the above image, assume the price of the product climbs to $75. 2a. If the price of $75 on the image above is, instead, a price __________, then it would be nonbinding within the market. 2b. If the price of $75 on the image above is a price __________, then it would be binding within the market.3. Using the above image, assume the price of the product drops to $25. 3a. If the price of $25 on the image above is a price floor, then it would be __________ within the market.4. Consider the market for theater movies. The price-intercept for the supply curve is $5. The price-intercept for the demand curve is $30. At equilibrium, this market sells 6,000 tickets at $15 per ticket. My suggestion is to draw this on your own paper, so you can see the illustration of the market dynamics and use it to answer these questions: 4a. Calculate the consumer surplus for theater movies. 4b. Calculate the producer surplus for theater movies. 4c. Calculate the total surplus for theater movies.

Answered: Refer to Question #1: Using the image…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Refer to Question #1: Using the image presented on the worksheet, the producer surplus is $_____. Do not forget to round to two decimal places, input the decimal point and two places to the right of the decimal point, and place a comma, if needed.

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Demand: - Demand is the relationship between the quantity demanded and the price of a good. There is an inverse relationship between quantity demanded and price, which means if the price of a good increases then the quantity demanded decreases and if the price of a good decreases then the quantity demanded increases.

Supply: - Supply is the relationship between the quantity supplied and the price of a good. There is a direct relationship between the quantity supplied and the price for normal goods which means if price increases quantity supplied increases and if price decreases quantity supplied also decreases.

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