6.7_Applications_summer

6.7_Applications_summer - 6.7 Consumers and Producers...

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Unformatted text preview: 6.7 Consumers and Producers Surplus Market Equilibrium If D(x) is the demand function for a certain product and S(x) is the supply function for the same product, Market Equilibrium is the point (x,p) where supply equals demand. Consumers Surplus The consumers surplus is given by CS = x [D(x) - p ] dx Where D is the demand function, x is the quantity sold, and p is the unit market price. 1. The demand function for a certain make of replacement cartridges is given by: D(x) = p(x) = -.01x 2- .1x + 8 where p is the unit price in dollars and x is the quantity demanded each week, measured in units of a thousand. (x = 20) Determine the consumers surplus if the market price is set at $2 per cartridge. ( select) 73,333 Producers Surplus The producers surplus is given by PS = x [p - S(x) ] dx Where S is the supply function, x is the quantity supplied, and p is the unit market price....
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6.7_Applications_summer - 6.7 Consumers and Producers...

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