Question

The demand curve of a perfectly competitive product is
described by the equation:

P = $1000 – Q where Q =
thousands

The supply curve is given by

P = $100 + 2Q where Q =
thousands

Graph the demand and supply curves; use a grid size of 100.
Calculate the equilibrium price and quantity (carefully state the
units). Find the consumer surplus CS, the producer surplus
PS, and the deadweight loss DWL, carefully stating the units.

Answer #1

The market for apples is perfectly competitive, with the market
supply curve is given by P = 1/8Q and the market demand curve is
given by P = 40 – 1/2Q.
a. Find the equilibrium price and quantity, and calculate the
resulting consumer surplus and producer surplus. Indicate the
consumer surplus and producer surplus on the demand and supply
diagram.
b. Suppose the government imposes a 10 dollars of sale tax on
the consumer. What will the new market price...

Suppose a perfectly competitive market has the following inverse
supply and demand curves: Supply: P= 5+2Q Demand: P = 50-Q.
1) Solve for the perfectly competitive Pe and Qe, and calculate
consumer+producer surplus at Pe, Qe.

(a) Consider a monopoly market with the following demand
equation for a good Z.
P = 100 – 0.2 Q
Suppose fixed cost is zero and marginal cost is given by MC =
20.
Answer the following questions.
(i) Based on the information given, draw the diagram which shows
the marginal revenue (MR) curve, marginal cost (MC) curve and the
demand (D) curve of the monopoly. Show the value of X and Y
intercepts for these curves.
(ii) Explain why...

1.Consider a single-price monopolist facing a demand curve of ,
where P is market price and q is quantity. The monopolist incurs
$40 as fixed cost. The monopolist’s variable cost function is given
by , where is quantity. In this market, what is the consumer
surplus (CS), producer surplus (PS), monopolist’ profits ( and
deadweight loss (DWL)?
Group of answer choices
a. CS=1000; PS=1250; =1210; DWL=0
b. CS=625; PS=1250; =1250; DWL=1250
c. None of the other answers is correct
d....

Consider a market with a perfectly
elastic demand curve at p∗ =
1,763 and a perfectly inelastic supply curve at
q∗ = 452. What is the Consumer Surplus? What is
the Producer Surplus?

The demand and supply curves for Fuji apples are given by
QD = 50 – 6P and
QS = 4P – 2, where P is price
per bag and Q is in thousands of bags. What are consumer
surplus and producer surplus at the equilibrium price?
Answer Choices:
CS = $29,422; PS = $44,180
CS = $15,006; PS = $7,657
CS = $856,000; PS = $1,126,113
CS = $450; PS = $375

Consider a market with a perfectly elastic demand curve at p∗ =
1,763 and a perfectly inelastic supply curve at q∗ = 452. What is
the Consumer Surplus? What is the Producer Surplus? (15%)

Deadweight Loss] Suppose the market for corn in Banana Republic
is competitive. The domestic supply and demand function of corn is
Qs = 10P and Qd = 100 − 10P, respectively. Both of them measured in
billions of bushels per year.
(a) Calculate the equilibrium price and quantity,
consumer surplus (CS), and producer surplus (PS).
(b) Suppose the government offers a subsidy of $2 per
bushel to the firms. In equilibrium, the consumers are paying $4
per bushel and the...

In a perfectly competitive market, the supply function is P= 1 +
2Q, and the demand function is P = 25 - Q. Hence, in this market,
consumer surplus is _____ and producer surplus is _____. If this
market was to become the monopoly of a single firm with a marginal
cost of production equal to 11, then the welfare loss would be
____.
a) 30; 60; 3
b) 32; 64; 1.5
c) 32; 64; 3
d) 62; 34; 6

A market has a demand curve given by P = 800 – 10Q where P =
the price per unit and Q = the number of units. The supply curve is
given by P =100 + 10Q.(10 points) Graph the demand and supply curves and calculate
the equilibrium price and quantity in this market.(5 points) Calculate the consumer surplus at equilibrium.(5 points) Calculate the producer surplus at equilibrium.(5
points)(5 points) Calculate the total surplus at equilibrium

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