To answer: The amount of consumer surplus generated in each of the following situations. Leon goes to the clothing store to buy a new T-shirt, for which he is willing to pay up to $10. He picks out one he likes with a price tag of exactly $10. When he is paying for it, he learned that the T-shirt has been discounted by 50%. Alberto goes to the music store hoping to find a used copy of Nirvana’s Never mind for up to $30. The store has one copy of the record selling for $30, which he purchases. After soccer practice, Stacey is willing to pay $2 for a bottle of mineral water. The 7-Eleven sells mineral water for $2.25 per bottle, so she declines to purchase it. Concept Introduction: Consumer Surplus: It is defined as the difference between consumer’s willingness to pay and how much does a consumer pay for the goods and services. It is the area above the price level and below the demand curve. Producer Surplus : It is defined as the difference between the amount a producer of a good receives and the minimum amount the producer is willing to accept for the good. It is the area below the price level and above the supply curve.

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HW Ch5 Calculate the daily total revenue when the market price is $180, $160, $140, $120, $100, $80, $60, and $40 per bippitybop. Then, use the green point (triangle symbol) to plot the daily total revenue against quantity corresponding to these market prices on the following graph. 2 @ 3840 3520 3200+ 2880 2560+ 2240 TOTAL REVENUE (Dollars) 1920 1600 1280 960 + 640+ 0 0 8 16 24 32 40 48 56 64 72 80 QUANTITY (Bippitybops per day) Total Revenue ? According to the midpoints formula, the price elasticity of demand between points A and B on the initial graph is approximately . Suppose the price of bippitybops is currently $60 per bippitybop, shown as point A on the initial graph. Because the price elasticity of demand between points A and B is , a $20-per-bippitybop decrease in price will lead to MacBook Air in total revenue per day. F2 80 F3 #3 $ 4 5 6 F6 < F7 * 8 & 27 DII 8 F8 F9 F10 61 0 W E R T Y U 0 P S D LL F G H J K L

Answer 1

Question

Chapter 4, Problem 1P

To determine

To answer:

The amount of consumer surplus generated in each of the following situations.

Leon goes to the clothing store to buy a new T-shirt, for which he is willing to pay up to $10. He picks out one he likes with a price tag of exactly $10. When he is paying for it, he learned that the T-shirt has been discounted by 50%.

Alberto goes to the music store hoping to find a used copy of Nirvana’s Never mind for up to $30. The store has one copy of the record selling for $30, which he purchases.

After soccer practice, Stacey is willing to pay $2 for a bottle of mineral water. The 7-Eleven sells mineral water for $2.25 per bottle, so she declines to purchase it.

Concept Introduction:

Consumer Surplus:

It is defined as the difference between consumer’s willingness to pay and how much does a consumer pay for the goods and services. It is the area above the price level and below the demand curve.

Producer Surplus:

It is defined as the difference between the amount a producer of a good receives and the minimum amount the producer is willing to accept for the good. It is the area below the price level and above the supply curve.

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HW Ch5 Calculate the daily total revenue when the market price is $180, $160, $140, $120, $100, $80, $60, and $40 per bippitybop. Then, use the green point (triangle symbol) to plot the daily total revenue against quantity corresponding to these market prices on the following graph. 2 @ 3840 3520 3200+ 2880 2560+ 2240 TOTAL REVENUE (Dollars) 1920 1600 1280 960 + 640+ 0 0 8 16 24 32 40 48 56 64 72 80 QUANTITY (Bippitybops per day) Total Revenue ? According to the midpoints formula, the price elasticity of demand between points A and B on the initial graph is approximately . Suppose the price of bippitybops is currently $60 per bippitybop, shown as point A on the initial graph. Because the price elasticity of demand between points A and B is , a $20-per-bippitybop decrease in price will lead to MacBook Air in total revenue per day. F2 80 F3 #3 $ 4 5 6 F6 < F7 * 8 & 27 DII 8 F8 F9 F10 61 0 W E R T Y U 0 P S D LL F G H J K L

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