Question

Select the two situations with the highest total surplus. correct answer(s) jay buys a house for $40,000 less than he was willing to pay. he bought his home from sellers who received $2,000 more than they were willing to sell for. bonnie buys flowers for $2.25 less than she was willing to pay. she bought them from a seller would have been willing to receive $3 less from the sale. don wanted to buy a scooter for no more than $5, but was only able to find a producer who would sell for $15. kevin wanted to spend $50 on a dishwasher and bought one at $45 from a producer who was hoping to receive $40.

Answer 1

Answer:

1) jay buys a house for $40,000 less than he was willing to pay. he bought his home from sellers who received $2,000 more than they were willing to sell for.

4) kevin wanted to spend $50 on a dishwasher and bought one at $45 from a producer who was hoping to receive $40.

Explanation:

total economic surplus = supplier surplus + consumer surplus

• supplier surplus is the difference between the minimum price that a seller would take for his/her products and the actual selling price
• consumer surplus is the difference between the maximum price that a consumer would be willing to pay for a product and the actual price

On scenario 1, total economic surplus = $40,000 + $2,000 = $42,000

On scenario 2, total economic surplus = $2.25 + $3 = $5.25

On scenario 3, total economic surplus = $0

On scenario 4, total economic surplus = $5 + $5 = $10

Answer 2

The two situations with the highest total surplus are :

Surplus is defined as an amount of something that has been left over, when all the requirements of a person have been met.

1. Jay buys a house for $40,000 less than he was willing to pay. he bought his home from sellers who received $2,000 more than they were willing to sell for.

4. Kevin wanted to spend $50 on a dishwasher and bought one at $45 from a producer who was hoping to receive $40.