Microeconomics
13th Edition
ISBN: 9781337617406
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 6, Problem 12QP
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The Reinheitsgebot is a set of laws established in the 1500s that regulate the production and sale
of beer in Germany. Among its provisions, the edict set maximum prices that brewers could
charge at various times of the year: During Oktoberfest, the price for one [Bavarian Liter] is not
to exceed one Pfennig (Penny, Munich value). Suppose that the demand for beer is given by
$QD = 6000-1600P, and the supply of beer is given by QS = -1000+2000P.
Calculate the consumer surplus received by beer drinkers and the producer surplus received by
beer producers after a 1-Pfennig price ceiling is imposed.
The Reinheitsgebot is a set of laws established in the 1500s that regulate the production and sale
of beer in Germany. Among its provisions, the edict set maximum prices that brewers could
charge at various times of the year: During Oktoberfest, the price for one [Bavarian Liter] is not
to exceed one Pfennig (Penny, Munich value). Suppose that the demand for beer is given by
$QD = 6000-1600P, and the supply of beer is given by QS = -1000+2000P.
%3D
Calculate the equilibrium price and quantity in a free market; then calculate consumer and
producer surplus.
Johnson's Household Products has a division that produces two types of toothpaste: a regular toothpaste and a whitening tooth paste. The demand equations that relate the prices, p and q (in dollars per thousand units), to the quantities demanded weekly, x and y (in units of a thousand), of the regular toothpaste and the whitening toothpaste are given by p=3000-20 x-10 yp=3000−20x−10y and q=4000-10 x-30 yq=4000−10x−30y respectively. The fixed cost attributed to the division is $20,000/week, and the cost for producing 1000 tubes of regular and 1000 tubes of whitening toothpaste is$400 and $500, respectively. a. What is the weekly total revenue function R(x, y)? b. What is the weekly total cost function C(x, y)? c. What is the weekly profit function P(x, y)? d. How many tubes of regular and whitening toothpaste should be produced weekly to maximize the division's profit? What is the maximum weekly profit?
Chapter 6 Solutions
Microeconomics
Ch. 6.1 - On Tuesday, the price and quantity demanded are 7...Ch. 6.1 - What does a price elasticity of demand of 0.39...Ch. 6.1 - Prob. 3STCh. 6.1 - Prob. 4STCh. 6.2 - Prob. 1STCh. 6.2 - Prob. 2STCh. 6.4 - Prob. 1STCh. 6.4 - Prob. 2STCh. 6.4 - Prob. 3STCh. 6.4 - Prob. 4ST
Ch. 6 - Prob. 1QPCh. 6 - For each of the following, identify where demand...Ch. 6 - Prove that price elasticity of demand is not the...Ch. 6 - Prob. 4QPCh. 6 - Prob. 5QPCh. 6 - Suppose a straight-line downward-sloping demand...Ch. 6 - Prob. 7QPCh. 6 - Prob. 8QPCh. 6 - Prob. 9QPCh. 6 - Prob. 10QPCh. 6 - Suppose you learned that the price elasticity of...Ch. 6 - Prob. 12QPCh. 6 - Prob. 13QPCh. 6 - Prob. 14QPCh. 6 - A college raises its annual tuition from 23,000 to...Ch. 6 - As the price of good X rises from 10 to 12, the...Ch. 6 - The quantity demanded of good X rises from 130 to...Ch. 6 - The quantity supplied of a good rises from 120 to...Ch. 6 - In the accompanying figure, what is the price...
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