6.7_Applications_summer

6.7_Applications_summer - 6.7 Consumers’ and Producers’...

This preview shows pages 1–4. Sign up to view the full content.

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

View Full Document

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

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

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....
View Full Document

{[ snackBarMessage ]}

Page1 / 8

6.7_Applications_summer - 6.7 Consumers’ and Producers’...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online