D(x) is the price, in dollars per unit, that consumers are willing to pay for x

Question

D(x) is the price, in dollars per unit, that consumers are willing to pay for x units of an item, and S(x) is the price, in dollars per unit, that producers are willing to accept for x units. Find (a) the equilibrium point, (b) the consumer surplus at the equilibrium point, and (c) the producer surplus at the equilibrium point. D(x) 4000 -20x, S(x) 2200 25x (a) What are the coordinates of the equilibrium point? (40,3200) (Type an ordered pair.) (b) What is the consumer surplus at the equilibrium point? $(Round to the nearest cent as needed.)

Explanation / Answer

At equilibrium Qd=Qs, then

4000-20x = 2200+25x

45x = 4000-2200

X = 1800/45 = 40

At X= 40, Qd= 4000-20*40 = 3200 = Qs

Coordinates will be (40,3200)

At Q=0, Qd = 4000-20*0 = 4000

Consumer Surplus = 0.5*(4000-3200)*40 = 16000 (calculated by the formuyla 0.5*Equilibrium Quantity*(Price at Q=0 - equilibrium price)

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.