The supply and demand curves of a product are shown in Figure 6.13. Approximate the difference in the total gains from trade if the price is artificially increased from the equilibrium price of p-95 to p - 110.punt2001801601401208888881008060402050(a) $137.50(b) $3,250(c) $4,675(6) $4,750100150Figure 6.13(4) $7862.50() $6000200Click if you would like to show Work for this question: Doen Show Work9thBy accessing this Question Assistance, you will learn while you earn points based on the Point Potential Policy set by your instructor0ViewSonicQuestion Attempts: 0 of 3 usedEarn Maximum Points availableanswer this question correctly

Equilibrium price = 95 Equilibrium quantity = 100 New price = 110

me supply and demand curves of a product are shown in Figure 6.13. Approximate the difference in the total gains from trade if the price is artificially increased from the equilibrium price of p-95 to p-110. 200 180 100 140 120 100 18888 20 50 100 150 200 Fig.13 (a) $137.50 (b) $3,250 (0) $4,675 (6) $4,750 () $7862.50 y

me supply and demand curves of a product are shown in Figure 6.13. Approximate the difference in the total gains from trade if the price is artificially increased from the equilibrium price of p-95 to p-110. 200 180 100 140 120 100 18888 20 50 100 150 200 Fig.13 (a) $137.50 (b) $3,250 (0) $4,675 (6) $4,750 () $7862.50 y

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

X A company manufactures and sells x television sets per month. The monthly cost and price-demand equations are C(x) = 73,000 + 80x and p(x) = 300 - 30 Osx<9000. (A) Find the maximum revenue. (B) Find the maximum profit, the production level that will realize the maximum profit, and the price the company should charge for each television set. (C) If the government decides to tax the company $4 for each set it produces, how many sets should the company manufacture each month to maximize its profit? What is the maximum profit? What should the company charge for each set?
If income of a household rises by 10% and demand rises by 40% then income elasticity is equal to 1 (b) 4 (а) 4 (c) 30 percent (d) None of the above
What kind of relationship exist between demand for a good and price of its substitute goods? (a) Direct (b) Inverse (c) No effect (d) Can be direct or inverse
A 2% increase in the price of carrot causes its sales to decrease by 6% and sales of sweet potato to increase by 10%. The cross elasticity of demand for sweet potato with respect to change of price in carrot is____. (a) 3 (b) -3 (c) 5 (d) - 5
00005 a) A b) B c) C d) D Submit 1) Starting from point E, which point is the most likely outcome of an increase in the price of soda pop? Price ($) E Quantity A 52
(A) (B © PRICE E $4 In the market shown in the graph above, at a price of $5, there will be 0 Supply Demand 10 QUANTITY (units) a surplus and the price will eventually fall a surplus generating a decrease in demand a shortage and the price will eventually rise a shortage generating an increase in supply an increase in supply and a decrease in demand
68 The demand equation for a product is q = + In (126 - p) (a) Determine the point elasticity of demand when p = 5 and classify the demand as elastic, inelastic, or of unit elasticity at this price level. (b) If the price is lowered by 2% (from $5.00 to $4.90), use the answer to part (a) to estimate the corresponding percentage change in quantity sold. (c) Will the changes in part (b) result in an increase or decrease in revenue? Explain. (a) The point elasticity of demand is (Round to two decimal places as needed.) when p = 5. Since Inl 1, demand is (b) The percentage change in quantity sold is % (Round to two decimal places as needed.) (c) Will the changes in part (b) result in an increase or decrease in revenue? Choose the correct answer below. A. Lowering the price does not affect revenue. B. Lowering the price increases revenue because demand is elastic. C. Lowering the price decreases revenue because demand is inelastic. D. Lowering the price decreases revenue because demand is…
When there is increase in demand and decrease in supply, equilibrium price: (a) Falls (c) Constant (d) None of these ention ng fo (b) Rises
The following graph shows the daily demand curve for bikes in Houston. Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve. Note: You will not be graded on any changes made to this graph. 240 220 200 Total Revenue 180 160 140 120 100 80 60 40 20 0 PRICE (Dollars per bike) 0 9 18 27 > 36 45 54 63 72 QUANTITY (Bikes) 00 8 Demand 90 81 99 106
PRICE (Dollars per pound) 10 9 8 7 2 1 0 0 Y X Demand 10 20 30 40 50 60 70 80 QUANTITY (Thousands of pounds of apples) 90 100 (?)
$1000) Average Incomes of Children with Low Income Parents (5) 9 50- 45- 40- 35- 30- 25- Upward Mobility versus Median Rent by Neighborhood Opportunity Bargains Normandy Parke 1,000 Central District 1,500 Median 2 Bedroom Rent 2,000 2,500 The image above displays the relationship between the cost of living as measured by the average rent of 2-bedroom housing, and income mobility as measured by the average income of children with low-income parents. Data for this image are from Seattle. Two neighborhoods are highlighted: Normandy Park and the Central District. Many people that receive housing vouchers would like to move to areas with high opportunities for their children, but assume those areas are too expensive. How do Normandy Park and the Central District illustrate the idea of *opportunity bargains"? there is a trade-off between the cost of living and higher income growth for the children. for families living in the Central District, Normand Park is more expensive to live in and has…
Include correctly labeled diagrams, if useful or required, in explaining your answers. A correctly labeled diagram must have all axes and curves clearly labeled and must show directional changes. If the question prompts you to “Calculate,” you must show how you arrived at your final answer. Assume gadgets are sold in a competitive market, the equilibrium price is $6, and the equilibrium quantity is 500 units. (c) Assume gadgets now become more popular. On your graph in part (a), show the effect of the increase in gadgets' popularity on the equilibrium price and quantity of gadgets. (d) Assume instead there is an increase in the price of tin, a major input in producing gadgets. What will be the effect of an increase in the price of tin on the market for gadgets? (e) If both changes in part (c) and part (d) occurred simultaneously, will the equilibrium quantity of gadgets increase, decrease, remain unchanged, or be indeterminate? Explain.