Microeconomics
2nd Edition
ISBN: 9781259813337
Author: KARLAN, Dean S., Morduch, Jonathan
Publisher: Mcgraw-hill Education,
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Question
Chapter 5, Problem 13PA
To determine
To draw and calculate: the
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p ($/unit)
200k
160
120
80
40
5000
Equilibrium price =$
Equilibrium quantity
a) What are the equilibrium price and quantity for the supply and demand curves in the figure above?
=
S
(quantity)
Consumer surplus =$ i
10000
b) Estimate the consumer and producer surplus.
Producer surplus =$ i
Round your answers to the nearest thousand.
SUPPORT
Consider a market in which demand and supply
functions are given as
Qd = 300-20P
Qs =, 20P-100
Calculate the
1 equilibrium price and quantity
2 a price ceiling of rs5 is imposed how does it
affect quantity demanded and quantity supplied.
Use diagram
3 Distinguish between consumers surplus and
producers surplus.
With the help of diagram.show how the
consumers surplus is determined. (10)
Refer to the figure entitled "Market for Meds". If a price ceiling is imposed at $4, what will be the change in consumer surplus?
Price (in $)
10
8
2
0
0
10
Market for Meds
20
30
Quantity
40
So
Do
50
1) Consumer surplus will fall by 2.5.
2) Consumer surplus will increase by 2.5.
3) Consumer surplus will decrease by 17.5.
4) Consumer surplus will increase by 17.5.
5) None of the above.
60
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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- Price of cheese $/16 $20 $10 $20 O 15 S Quantity of cheese (lbs) Refer to the diagram above. The total producer surplus in the market for cheese is $_____ Please input only the numerical value without the $ sign. If your answer is $20, please input 20 for your answer.arrow_forwardA consumer has inverse demand ot p= 15-0.5q for a good and the market price is $3.00. Calculate consumer surplus and the total value of the good for the corresponding quantity consumed Consumer surplus is (Enter your response rounded to two decimal places)arrow_forwardPrice $25 20 15 10 10 15 20 25 Quantity At the equilibrium price, the area of consumer surplus is just the number, no symbols or letters; and use decimals as it applies) dollars. (writearrow_forward
- Comsumer Surplus Study The goal of this assignment is to apply Calculus to analyze consumer and producer surplus. This activity is based off the economical principles discussed in Section 3.1 of "Principle of Economics" and Section 7 of Chapter 3 in the Business Calculus book. The table below shows how supply and demand of gasoliine vary depending on the price: Price ($/gal) Demand (million of gal.) Supply (million of gal.) 753 513 550 1.2 700 1.4 640 600 1.6 580 639 1.8 543 660 2.2 450 680 2.4 430 700 2.6 420 720 2.8 390 735 3. 367 763 Note: there is some randomization in the above data to account for price fluctuations. Make sure to check that you input the correct data in your device. Perform the following work • Assume that Supply has a quadratic relationship with the price. Find this relationship (the help buttons contain an article to compute trend-lines in Excel): S(p) = Round your answer to 3 decimal places %3D • Assume that the Demand has a quadratic relationship with the…arrow_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_forwardA consumer is willing to purchase an item for $30 but he gets item at a market price of $22. Calculate the consumer surplus.arrow_forward
- Suppose the market equilibrium wage is $11.00 an hour, and the minimum wage is currently $8.00 an hour. 2nd attempt (a) An increase in the minimum wage by $2.00 an hour to $10.00 an hour would result in an increase in the number of people looking for jobs. (b) The quantity of labor demanded would decrease (c) Overall, this increase in the minimum wage would result in 1st attempt a surplus ▼ See Hi in the labor market.arrow_forwardBased on the figure below, consumer surplus is $0 when price is greater than or equal to $ Price ($) 16 543210 15 14 13 12 11 10 9 4N31SRL86 5 2 0 S Quantity D 10 20 30 40 50 60 70 80 90 100arrow_forward10arrow_forward
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