This table refers to five possible buyers' willingness to pay for Frapuccino.   Buyer Willingness To Pay David $8.50 Laura $7.00 Megan $5.50 Mallory $4.00 Audrey $3.50       Refer to the table above to answer the following questions. If the market price is $5.70, who will buy Frapuccino and

Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter7: Consumers, Producers, And The Efficiency Of Markets
Section: Chapter Questions
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  1. This table refers to five possible buyers' willingness to pay for Frapuccino.

 

Buyer

Willingness To Pay

David

$8.50

Laura

$7.00

Megan

$5.50

Mallory

$4.00

Audrey

$3.50

      Refer to the table above to answer the following questions.

  • If the market price is $5.70, who will buy Frapuccino and what will be the total consumer surplus in the market?
  • If government imposes a $2.30 tax on a unit of Frapuccino, leading the price of Frapuccino to$8.00, who will buy Frapuccino? What will be the dead weight loss associated with this Frapuccino market? 
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