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Unformatted text preview: Air Travel and Corn Markets Price ($/bushel) Millions of bushels S W D Q W Q S P W P S S S High Consumption due to High Supply Chapter 3 - Supply and Demand: An Introduction Slide 71 Markets and Social Welfare If all exchange is purely voluntary, then the buyers reservation price exceeds the sellers reservation price and both the buyer and seller receive an economic surplus. Chapter 3 - Supply and Demand: An Introduction Slide 72 Markets and Social Welfare Buyers surplus z The difference between the buyers reservation price and the price he or she actually pays. Sellers surplus z The difference between the price received by the seller and his or her reservation price. Total surplus z The difference between the buyers reservation price and the sellers reservation price....
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This note was uploaded on 02/20/2012 for the course ECON 202 taught by Professor Brightwell during the Spring '08 term at Texas A&M.
- Spring '08