Permachart - Marketing Reference Guide: Economic Surplus, Price Ceiling, Economic Equilibrium

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yellowsheep217

4 Jun 2015

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Economics is the study of how people and societies allocate scarce resources among competing objectives. Macroeconomics looks at the economy as a whole; Microeconomics concentrates on individual parts of the economy. This permachart is designed as a supplement to the core textbook used in an introductory microeconomics course. Reading this permachart is not a substitute for reading and understanding the text. Instead, this permachart complements the text by highlighting the most important concepts, graphs, and theories. Think of it as a quick refresher course in. The production possibilities frontier (ppf) illustrates the fundamental economic problem of scarcity and choice. We face limits on the amount of goods we can produce (scarcity), and we face trade-offs between consuming more of one good or more of another good. Without trade (between individuals, and between countries) there would be no markets, and so no supply or demand, and no prices.

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Summer is ending. Now that consumers no longer are going to the beach there is a vertical shift down in demand of 20 at each price point. In other words, the new demand curve is: P = 380 â Q. The supply curve stays the same. a. Find the market equilibrium price and quantity. b. Calculate consumer surplus and producer surplus..

4. Summer is ending. Now that consumers no longer are going to the beach there is a vertical shift down in demand of 20 at each price point. In other words, the new demand curve is: P = 380 â Q. The supply curve stays the same. a. Find the market equilibrium price and quantity. b. Calculate consumer surplus and producer surplus. .there is only this information on this question

In a competitive market, the market demand curve is Q = 28-2p and the market supply curve is Qs = -8 + 2p. Use a spreadsheet to answer the following questions.

a. Determine the quantity demanded and quantity supplied for p = $4, 5, 6, 14. Determine the equilibrium quantity and price.

b. For prices p = $4, 5, 6, 14, determine the consumer surplus. How does an increase in price affect the consumer surplus?

c. For prices p = $4, 5, 6, 14, determine the producer surplus. How does an increase in price affect the producer surplus?

d. Suppose the government limits the quantity traded in the market to 6 units. Calculate the resulting deadweight loss.

magentacaribou480

Suppose that the demand for broccoli is given by:

Demand: Q= 1,000 - 5P

Where Q is quantity per year measured in hundreds of bushels and P is price in dollars per hundred bushels. The long-run supply curve for broccoli is given by

Supply: Q= 4p - 80

A) Show that the equilibrium quantity here is Q=400. At this output, what is the equilibrium price? How much in total is spent on broccoli? What is consumer surplus at this equilibrium? What is producer surplus at this equilibrium?

B) How much in total consumer and producer surplus would be lost if Q=300 instead of Q=400?

C) Show how the allocation of the loss of total consumer and producer surplus between suppliers and demanders described in part b depends on the price at which broccoli is sold. How would the loss be shared if P=140? How about if P=95?

D) What would the total loss of consumer and producer surplus be if Q=450 rather than Q=400? Show that the size of this total loss also is independent of the price at which the broccoli is sold.

E) Graph your results.

silvercat77

Permachart - Marketing Reference Guide: Economic Surplus, Price Ceiling, Economic Equilibrium

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