Define consumer surplus, and explain how you would show it in a diagram containing a demand curve for some product. What would consumer surplus equal in Figure if the demand was perfectly elastic at the market price of $ 3 per espresso cup?
Answer to relevant QuestionsExplain how a bandwagon effect might speed up the rate at which DVD players are adopted by consumers. Do likewise for the case of cable television subscriptions.Repeat the preceding question but assume that a decrease in the price of cigars leads to a decrease in George’s scotch consumption. Does this imply that scotch is an inferior good in George’s case?“A higher interest rate lowers the present cost of future consumption.” “A higher interest rate raises the future cost of present consumption.” Use an example to show that both statements are correct. With an excise tax of $ 0.20 per six-pack, Kristine purchases three six- packs of Diet Coke per day. If the government eliminates the excise tax and, instead, requires Kristine to pay $ 0.60 per day as a lump-sum tax (the ...Fill in the spaces in the accompanying table associated with the firm William Perry, Inc., that delivers refrigerators in the Chicago area, using the two inputs of labor andtrucks.
Post your question