HW chap 6-7

00 s52520000 s32500

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Unformatted text preview: is where the demand curve intersects the horizontal axis. When S equals zero, PS equals 525/50 = 10.5. This is where the demand curve intersects the vertical axis. Consumer surplus is the netbenefit a consumer receives from participating in the market for a good. Graphically, it is equal to the area under the demand curve and above the price. When the price is $4.00, the quantity demanded equals: S = 525 – 50(4.00) S = 525 – 200.00 S = 325.00. Consumer surplus (CS) initially equals the area of...
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This note was uploaded on 01/22/2014 for the course ECO 3352 taught by Professor Ax during the Fall '13 term at Troy.

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