The equilibrium price is € per flu jab, and the equilibrium quantity is jabs per day. If the government imposes a maximum price of €14 per flu jab, there will be of jabs per day. At the price control of €14 per jab, the quantity supplied is per day. At this quantity, the maximum price the residents of this village are willing to pay is € per jab.

ENGR.ECONOMIC ANALYSIS
14th Edition
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Author:NEWNAN
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Chapter1: Making Economics Decisions
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7. First Come, First Served? The graph shows the downward-sloping demand for, and the upward-sloping supply of, flu jabs facing a clinic in a remote village. This clinic is the only place providing flu jabs to the residents of this village
The equilibrium price is €
per flu jab, and the equilibrium quantity is
jabs per day.
If the government imposes a maximum price of €14 per flu jab, there will be
of
jabs per day.
At the price control of €14 per jab, the quantity supplied is
per day. At this quantity, the maximum price the residents of this village are
willing to pay is €
per jab.
People will wait in line until the total cost of the flu jab (price for the jab plus waiting time) equals the maximum price they are willing to pay at the
quantity supplied under the price control. On the graph, use the orange rectangle (square symbols) to shade the area representing the total value of
time wasted in line. The total value of time wasted in line is €
Transcribed Image Text:The equilibrium price is € per flu jab, and the equilibrium quantity is jabs per day. If the government imposes a maximum price of €14 per flu jab, there will be of jabs per day. At the price control of €14 per jab, the quantity supplied is per day. At this quantity, the maximum price the residents of this village are willing to pay is € per jab. People will wait in line until the total cost of the flu jab (price for the jab plus waiting time) equals the maximum price they are willing to pay at the quantity supplied under the price control. On the graph, use the orange rectangle (square symbols) to shade the area representing the total value of time wasted in line. The total value of time wasted in line is €
40
36
Supply
Wasted Time Value
32
28
24
20
Controlled Price
Demand
10
20
30
40
50
60
70
80
90
100
QUANTITY (Jabs per day)
The equilibrium price is €
per flu jab, and the equilibrium quantity is
jabs per day.
If the government imposes a maximum price of €14 per flu jab, there will be
of [
jabs per day.
At the price control of €14 per jab, the quantity supplied is
per day. At this quantity, the maximum price the residents of this village are
willing to pay is €
per jab.
PRICE OF FLU JAB (Euros)
Transcribed Image Text:40 36 Supply Wasted Time Value 32 28 24 20 Controlled Price Demand 10 20 30 40 50 60 70 80 90 100 QUANTITY (Jabs per day) The equilibrium price is € per flu jab, and the equilibrium quantity is jabs per day. If the government imposes a maximum price of €14 per flu jab, there will be of [ jabs per day. At the price control of €14 per jab, the quantity supplied is per day. At this quantity, the maximum price the residents of this village are willing to pay is € per jab. PRICE OF FLU JAB (Euros)
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