Table 4-7

-Refer to Table 4-7.The equations above describe the demand and supply for Pauline's Pickled Pomegranates.The equilibrium price and quantity for Pauline's Pickled Pomegranates are $30 and 15 thousand units.What is the value of consumer surplus?

Question

Table 4-7
 
-Refer to Table 4-7.The equations above describe the demand and supply for Pauline's Pickled Pomegranates.The equilibrium price and quantity for Pauline's Pickled Pomegranates are $30 and 15 thousand units.What is the value of consumer surplus?

Quizplus · Accepted Answer

To find the consumer surplus, we need to calculate the area above the equilibrium price but below the demand curve. The equation for demand is Q = 90 - 3P, which we can rearrange to P = 30 - Q/3.

At the equilibrium quantity of 15 thousand units, P = $30. Therefore, the consumer surplus is:

Consumer Surplus = (1/2)(30-0)(15) = $225 thousand

So the answer is (C).

Table 4-7 -Refer to Table 4-7.The Equations Above Describe the Demand and Describe