Microeconomics
2nd Edition
ISBN: 9781259813337
Author: KARLAN, Dean S., Morduch, Jonathan
Publisher: Mcgraw-hill Education,
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Chapter 5, Problem 10PA
To determine
To represent: the
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Is the shadow price of a dairy feed ration different from the price the farmer pays per pound of the ration? Explain. Of what importance is a shadow price to a farmer seeking to maximize profits from a dairy herd?
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7. Producer surplus for an individual and a market
Suppose the market for cheesecake is a perfectly competitive market-that is, sellers take the market price as given. Sean owns a restaurant where
he sells cheesecake. The following graph shows Sean's weekly supply curve, represented by the orange line. Point A represents a point along his
supply curve. The price of cheesecake is $3.00 per slice, as shown by the horizontal black line.
Sean's Weekly Supply
7.50
6.75
6.00
5.25
4.50
3.75
3.00
Price
225
1.50
0.75
Supply
4.
10
12
14
16
18
20
QUANTITY (Slices of cheesecake)
PRICE (Dollars per slice)
Chapter 5 Solutions
Microeconomics
Ch. 5 - Prob. 1RQCh. 5 - Prob. 2RQCh. 5 - Prob. 3RQCh. 5 - Prob. 4RQCh. 5 - Prob. 5RQCh. 5 - Prob. 6RQCh. 5 - Prob. 7RQCh. 5 - Prob. 8RQCh. 5 - Prob. 9RQCh. 5 - Prob. 10RQ
Ch. 5 - Prob. 11RQCh. 5 - Prob. 12RQCh. 5 - Prob. 13RQCh. 5 - Prob. 14RQCh. 5 - Prob. 15RQCh. 5 - Prob. 16RQCh. 5 - Prob. 1PACh. 5 - Prob. 2PACh. 5 - Prob. 3PACh. 5 - Prob. 4PACh. 5 - Prob. 5PACh. 5 - Prob. 6PACh. 5 - Prob. 7PACh. 5 - Prob. 8PACh. 5 - Prob. 10PACh. 5 - Prob. 11PACh. 5 - Prob. 12PACh. 5 - Prob. 13PACh. 5 - Prob. 14PACh. 5 - Prob. 15PACh. 5 - Prob. 16PACh. 5 - Prob. 17PACh. 5 - Prob. 18PACh. 5 - Prob. 19PACh. 5 - Prob. 20PACh. 5 - Prob. 21PACh. 5 - Prob. 22PACh. 5 - Prob. 23PACh. 5 - Prob. 24PACh. 5 - Prob. 25PA
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- this is another question 7arrow_forwardWhy is my answer wrong?Please make graph and show what area you need to calculate. And find it geometrically answer and question Are attachedarrow_forwardThe table shows the demand and supply schedules for hamburgers. If the quantity demanded of hamburgers decreases by 40 per hour at each price, the new price of a hamburger is $ Total surplus by $arrow_forward
- Consider a market where the equilibrium price for a good is $17 and the equilibrium quantity is 350 units. Assume that the quantity supplied at an above - equilibrium price is 5 times the equilibrium quantity, and the quantity demanded at the above - equilibrium price is 1/3 the equilibrium quantity. Calculate the surplus in the market at the above - equilibrium price. If necessary, round any intermediate calculations to one decimal place and your final answer to the nearest whole number.arrow_forward9arrow_forwardConsider the market for LCD TVs, illustrated in the figure to the right. Use the point drawing tool to identify the market equilibrium. Properly label this point. Carefully follow the instructions above, and only draw the required objects. Suppose instead that the price of LCD TVs is $2000.00. This will result in a , which will place pressure on the price. Price of LCD TVs 3000 2600- 2200- 1800- 1400- 1000- 600- 200- 2000 4000 6000 8000 Quantity of LCD TVs S 10000arrow_forward
- Hand written solutions are strictly prohibitedarrow_forwardFill in the blanks using the information from the chartarrow_forward14 ts Print erences Consider the market represented in the figure below. Draw the producer surplus if the price (P₁) is $9. Instructions: Use the tool provided 'PS' to illustrate this area on the graph. Drag the points to move and resize. Price $16 $15 $14 $13 $12 $11 $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 0 S Quantity 1 D 10 20 30 40 50 60 70 80 90 100 Instructions: Enter your answer as a whole number. The value of producer surplus at a price of $9 is: $ Tools X PSarrow_forward
- Calculate the producers' surplus for the supply equation at the indicated unit price p. (Round your answer to the nearest cent.) p = 90 + q; p = 225 $ Note: Hand written not allowedarrow_forwardCalculate the producers' surplus for the supply equation at the indicated unit price p. HINT [See Example 2.] (Round your answer to the nearest cent.) p = 90 + q; p = 230arrow_forwardThe supply and demand for concert tickets are given in the table below.Price (R)0481216202428323640Quantity Demanded15141312111098765Quantity Supplied0000013579114.1.1. Plot the supply and demand curves to scale and establish the equilibrium price and quantity. 4.1.2. What is the excess supply or demand (as applicable) when price is R24? And when price is R36? 4.1.3. Describe the market adjustments in price induced by these two prices. 4.1.4. The functions underlying the example in the table are linear and can be presented as P = 18+2Q (supply) and P = 60−4Q (demand). Solve the two equations for the equilibrium price and quantity values. 4.2. Briefly explain how each of the following affects the demand for goods and services in a market place and highlight the effects on price and the equilibrium position.4.2.1. Price of the product or service 4.2.2. Price of related goods; 4.2.3. Income of consumers; 4.2.4. Number of consumers;arrow_forward
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