Suppose Yvette just sat down to enjoy the Double Stack burger that she purchased for $1.00. Her friend, Sean, would also like a Double Stack burger, but he strongly dislikes standing in line. Sean offers to buy Yvette's Double Stack rather than wait in line himself and pay $1.00. The following table shows some hypothetical offers Sean might make for Yvette's burger. First, compute the consumer surplus Yvette gets from buying the burger for $1.00, refusing Sean's offers, and eating the burger. Enter these amounts in the second column of the following table. Next, compute the consumer surplus she gets from buying the first burger at $1.00, selling it to Sean at each price listed, purchasing another burger for $1.00, and consuming it. Enter these amounts in the third column of the table. Again, assume that Yvette's cost of waiting in line for a burger is zero. Note: If Yvette is willing to sell her burger to Sean while at the Wendy's restaurant, she would purchase another burger immediately, since the value of the burger ($2.00) remains higher than the price of the burger ($1.00). Yvette's Consumer Surplus from... Purchasing and Consuming Immediately Purchasing, Selling, Purchasing Again, Then Consuming Offer Price from Friend (Dollars) (Dollars) $1.75 $2.25 $2.75 Assuming her cost of waiting in line is zero, what's the lowest of the offers listed in the prior table that Yvette would accept in exchange for her burger? O $1.75 O $2.25 O $2.75
Suppose Yvette just sat down to enjoy the Double Stack burger that she purchased for $1.00. Her friend, Sean, would also like a Double Stack burger, but he strongly dislikes standing in line. Sean offers to buy Yvette's Double Stack rather than wait in line himself and pay $1.00. The following table shows some hypothetical offers Sean might make for Yvette's burger. First, compute the consumer surplus Yvette gets from buying the burger for $1.00, refusing Sean's offers, and eating the burger. Enter these amounts in the second column of the following table. Next, compute the consumer surplus she gets from buying the first burger at $1.00, selling it to Sean at each price listed, purchasing another burger for $1.00, and consuming it. Enter these amounts in the third column of the table. Again, assume that Yvette's cost of waiting in line for a burger is zero. Note: If Yvette is willing to sell her burger to Sean while at the Wendy's restaurant, she would purchase another burger immediately, since the value of the burger ($2.00) remains higher than the price of the burger ($1.00). Yvette's Consumer Surplus from... Purchasing and Consuming Immediately Purchasing, Selling, Purchasing Again, Then Consuming Offer Price from Friend (Dollars) (Dollars) $1.75 $2.25 $2.75 Assuming her cost of waiting in line is zero, what's the lowest of the offers listed in the prior table that Yvette would accept in exchange for her burger? O $1.75 O $2.25 O $2.75
Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter5: Consumer Choice: Individual And Market Demand
Section: Chapter Questions
Problem 6TY
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