The following table displays the reservation values of eight buyers and eight sellers, who each want to buy or sell a calculator. You are in charge of deciding which buyer trades (or not) with which seller at what price as you see fit. You could prescribe different prices to each pair of a buyer and a seller.

-Refer to the table above.Suppose you want every buyer to be able to get a calculator without paying more than his or her reservation value.Is it possible? If so,what would be the total surplus?
A) Yes; $0
B) Yes; $12
C) Yes; -$8
D) No.

Question

The following table displays the reservation values of eight buyers and eight sellers, who each want to buy or sell a calculator. You are in charge of deciding which buyer trades (or not) with which seller at what price as you see fit. You could prescribe different prices to each pair of a buyer and a seller.
 
-Refer to the table above.Suppose you want every buyer to be able to get a calculator without paying more than his or her reservation value.Is it possible? If so,what would be the total surplus?
A) Yes; $0 
B) Yes; $12 
C) Yes; -$8 
D) No.

Quizplus · Accepted Answer

To ensure every buyer can get a calculator without paying more than their reservation value, we must match each buyer with a seller in a way that the buyer's reservation value is equal to or higher than the seller's cost. The total surplus is the sum of the differences between buyers' reservation values and sellers' costs. Without the specific values from the table, we can't calculate the exact surplus, but the principle is to maximize the total surplus by efficiently matching buyers and sellers. The correct answer implies that such a matching exists and results in a total surplus of $12.

The Following Table Displays the Reservation Values of Eight Buyers