ECON 201 Lecture Notes - Lecture 7: Demand Curve, Marginal Utility, Equilibrium Point
24 Feb 2015
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Liam consumer surplus (willing to play only pays ) Miley cs . Taylor cs sh because she pays what she was willing to pay. Kanye doesn"t buy. Total consumer surplus = : area above the price and below the demand curve. If the price fell to from . Ted - : draw a step graph with smallest on the left. Actual price at : ted producer surplus , sara ps sh. Price goes up to now: ted ps , sara - ps . Joe - : lindsay ps sh. Producer surplus: producer surplus is th area above the supply curve and below the price. Draw a graph with demand curve going down and cross with supply curve: mark equilibrium. Practice finding cs and ps (two triangles on top of each other on the left) Total surplus add both. Benefit from all units: the relevant area under the marginal benefit curve.
