Asked by Amanda Sammons on May 02, 2024
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(Table: Pumpkin Market) There are two consumers,Andy and Ben,in the market for pumpkins.Their willingness to pay for each pumpkin is shown in the table Pumpkin Market.There are two producers of pumpkins,Cindy and Diane,and their costs are also shown.The equilibrium price for pumpkins is $8 and the equilibrium quantity is 5.At the equilibrium price and quantity,total producer surplus is:
A) $0.
B) $8.
C) $11.
D) $14.
Producer Surplus
The discrepancy between the price sellers are ready to accept for an item and the price they actually receive.
Equilibrium Price
The cost point where the amount of a product or service consumers want to buy matches the amount available, resulting in a balanced market.
Equilibrium Quantity
The quantity of goods or services supplied equals the quantity demanded at the market equilibrium price.
- Distinguish between consumer surplus and producer surplus.
- Quantify the overall consumer and producer surplus stemming from outlined market contexts.
Verified Answer
Learning Objectives
- Distinguish between consumer surplus and producer surplus.
- Quantify the overall consumer and producer surplus stemming from outlined market contexts.
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