The figure on the right displays the market for video game consoles, where nine buyers are interacting with nine sellers. According to this figure, the equilibrium price is $, and at that price, the equilibrium quantity is When the market is in equilibrium, social surplus is $. If the number of consoles is restricted to two less than the equilibrium quantity, social surplus is $. Alternatively, if the government mandated that one more video game console than equilibrium be transacted, social surplus is now $ From this analysis, it can be concluded that a market in competitive equilibrium social surplus. 900- 800- 700- 600- 8500 400- 300- 200- 100- 0 Market for Video Game Consoles 2 Quantity Q

The figure on the right displays the market for video game consoles, where nine buyers are interacting with nine sellers. According to this figure, the equilibrium price is $, and at that price, the equilibrium quantity is When the market is in equilibrium, social surplus is $. If the number of consoles is restricted to two less than the equilibrium quantity, social surplus is $. Alternatively, if the government mandated that one more video game console than equilibrium be transacted, social surplus is now $ From this analysis, it can be concluded that a market in competitive equilibrium social surplus. 900- 800- 700- 600- 8500 400- 300- 200- 100- 0 Market for Video Game Consoles 2 Quantity Q

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The figure on the right displays the market for video game consoles, where nine buyers are interacting with nine
sellers.
According to this figure, the equilibrium price is $, and at that price, the equilibrium quantity is
When the market is in equilibrium, social surplus is $.
If the number of consoles is restricted to two less than the equilibrium quantity, social surplus is $.
Alternatively, if the government mandated that one more video game console than equilibrium be transacted,
social surplus is now $.
From this analysis, it can be concluded that a market in competitive equilibrium
social surplus.
៖
900+
800-
700-
600-
500-
400-
300-
200-
100-
0
Market for Video Game Consoles
Quantity
6 7

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Step 1: General introductions:

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Step 2: Calculating equilibrium price and quantity:

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Step 3: Calculating social surplus when market is in equilibrium:

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Step 4: Calculating equilibrium quantity and social surplus under restrictions:

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Step 5: Calculating social surplus when extra unit of console is allowed:

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Step 6: Final Analysis:

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