Consider the information given in the table on four consumers in the market for orange juice. _____________________________
Question:
Consider the information given in the table on four consumers in the market for orange juice.
_____________________________ Highest Price
Consumer ____________________ Willing to Pay
Jill .................................................. $4
Jose .................................................. 3
Josh .................................................. 2
Jordan ............................................... 1
a. If the price of a bottle of orange juice is $0.75, what is the total consumer surplus received by these consumers? Illustrate your answer with a graph.
b. Suppose the price of a bottle of orange juice rises to $1.50. Now what is the consumer surplus received by these consumers? Illustrate your answer using the graph you prepared in part (a).
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