Suppose that you are the vice president of operations of a manufacturing firm that sells an industrial lub competitive market. Further suppose that your economist gives you the following supply and demand f Demand: Qº Supply: QS = - What is the consumer surplus in this market? Consumer surplus is $25 (Enter your response rounded to two decimal places.) What is the producer surplus? Producer surplus is $50 (Enter your response rounded to two decimal places.) = 50-2P = -10 + P.
Suppose that you are the vice president of operations of a manufacturing firm that sells an industrial lub competitive market. Further suppose that your economist gives you the following supply and demand f Demand: Qº Supply: QS = - What is the consumer surplus in this market? Consumer surplus is $25 (Enter your response rounded to two decimal places.) What is the producer surplus? Producer surplus is $50 (Enter your response rounded to two decimal places.) = 50-2P = -10 + P.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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can you let me know if this is correct and not show me the answers. thanks
Transcribed Image Text:Suppose that you are the vice president of operations of a manufacturing firm that sells an industrial lubricant in a
competitive market. Further suppose that your economist gives you the following supply and demand functions:
Demand:
= 50-2P
QD
QS = -10 + P.
Supply:
What is the consumer surplus in this market?
Consumer surplus is $25. (Enter your response rounded to two decimal places.)
What is the producer surplus?
Producer surplus is $50. (Enter your response rounded to two decimal places.)
Expert Solution
Step 1
Consumer surplus refers to the area that lies above the price and below the demand curve.
Producer surplus refers to the area that lies above the supply and below the price level.
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