ECON103_A2_Spring09 - ECON 103, Spring 2009 Simon Fraser...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: ECON 103, Spring 2009 Simon Fraser University Assignment 2 Due in tutorials in the week of February 9 th Do Problem 36 from chapter 7, p.160. (4 marks) Question 1 (4 marks) On p. 119 of the textbook (paragraph 3 from the top) it says that Darlenes sellers surplus is the difference between the total revenue she gets and her total value of the eggs she sells. Explain clearly why we have to subtract her TV from TR in order to calculate her surplus. After all, she managed to sell 15 eggs at P = 10 cents each, so technically when she comes back home from the market she has $1.50 in her pocket. How come her gains from trade are only 45 cents? (Hint: you might start with explanation of what is the meaning of sellers surplus and what it is supposed to measure. One more hint: gains from trade.) Question 2 (4 marks) Producers of peanuts discover a new technology that allows them to double yield per acre of land without increasing the production cost. Even if almonds and peanuts are substitutes, market for almonds should not be affected by this change because de-...
View Full Document

This note was uploaded on 09/13/2009 for the course ECONOMICS Econ 103 taught by Professor Iryina during the Spring '09 term at Simon Fraser.

Page1 / 2

ECON103_A2_Spring09 - ECON 103, Spring 2009 Simon Fraser...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online