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Consumer surplus | Economics homework help

4.         What is the combined consumer surplus for the five consumers in Figure 5.4 who buy Spyders when the price drops to \$800,000?

5.         What is the total revenue (price 3 quantity) received by the car dealer in Figure 5.4 if he charges

(a)                A uniform price of \$750,000?

(b)               Maximum individual prices to Fred, Michel, Hua, Carlos, John, and Marty?

LO5-3  6.  The following data reveal how much

\$2,000 1,900

1,800

1,700

1,600

1,500

1,400

1,300

1,200

1,100

1,000

900

800

700

600

500

400

300

200

100

0

0     1

2     3     4     5     6     7     8     9   10

QUANTITY (cruises per period)

each consumer is willing to pay for an Alaskan cruise:

Amy                    \$   900      Ed                      \$2,000 Bob              \$1,100      Gigi            \$1,300 Carol                  \$1,500      Hugo          \$1,800 Eduardo       \$   400       Isabelle      \$1,500

(a)      Draw the market demand for these eight consumers on the accompanying graph.

(b)      )  If the cruise costs \$1,000, how many

passengers will there be?

(c)      )  If the cruise costs \$1,000, how much

total revenue will be collected?

(d)      ) If the cruise costs \$1,000, how much consumer surplus will those

passengers enjoy?

(e)      ) If the cruise ship could perfectly price discriminate, how much more

revenue could it take in?

LO5-4

LO5-1

114

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