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oksian1 [2.3K]
3 years ago
6

Carolina is trying to sell her car, and the lowest amount she is willing to accept is $2,000. Abdul is interested in buying the

car, and although he is willing to pay $2,500, he negotiates a price of $2,100. How much consumer surplus does Abdul attain, and what is the total surplus?
Business
2 answers:
Usimov [2.4K]3 years ago
4 0

Answer:

How much consumer surplus does Abdul attain, and what is the total surplus?

  • Abdul's consumer surplus = $400
  • total surplus = $500

Explanation:

Abdul's consumer surplus = price he is willing to pay for the car - purchase price = $2,500 - $2,100 = $400

Carolina's supplier surplus = sales price - minimum price that she would accept = $2,100 - $2,000 = $100

Total surplus = consumer surplus + supplier surplus = $400 + $100 = $100

andreyandreev [35.5K]3 years ago
3 0

Answer:

Abdul's surplus= $400

Total surplus=$500

Explanation:

Consumer surplus can be defined as the amount a consumer is willing to pay and the amount he actually paid (which is usually less).

Given:

Carolina willing selling price=$2,000

Abdul willing buying price=$2,500

Abdul negotiated price=$2,100

Abdul is willing to pay $2,500 but he negotiated $2,100

Abdul's surplus= $2,500-$2,100

=$400

Total surplus= Abdul's willing price - carolilina's willing price

Total surplus= $2,500 - $2,000

= $500

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Answer:

Explanation:

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3 years ago
A popular, local coffeeshop in one of the suburbs of New York City (NYC) estimates they use 3,500 pounds of coffee annually. The
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a) The determination of the optimal size of the order assuming an EOQ model for the local coffee shop is <u>265 pounds</u>.

b) The total cost in the new coffee shop where the demand for coffee increased to 4,000 pounds at an order size of 265 pounds per order (assuming a unit cost of $3 per pound) is <u>$253,500</u>.

<h3>What is the EOQ Model?</h3>

The economic order quantity (EOQ) model calculates the ideal order quantity a company should purchase to minimize inventory costs such as holding costs, shortage costs, and order costs.

It is determined using the following model:

EOQ = square root of: 2 (ordering costs)(demand rate) / holding costs.

Thus, the EOQ model can be worked out as follows:

  • Determine the demand units.
  • Determine the ordering cost.
  • Determine the holding cost.
  • Multiply the demand by 2.
  • Then multiply the result by the order cost.
  • Divide the result by the holding cost.

<h3>Data and Calculations:</h3>

a) The annual demand for coffee = 3,500 pounds

Holding cost per pound = $10

Ordering cost = $100

EOQ = square root of: 2 ($100 x 3,500) / $10

= 265 pounds

The annual demand for coffee = 4,000 pounds

Holding cost per pound = $60

Ordering cost = $100

EOQ (Order size) = 265 pounds

Assumed unit cost per pound = $3

The total cost in the new coffee shop = $

Annual holding cost = $240,000 ($60 x 4,000)

Annual ordering cost = $1,500 ($100 x 4,000/265)

Annual purchase cost = $12,000 (4,000 x $3)

Total costs = $253,500

Learn more about the economic order quantity at brainly.com/question/14625177

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