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s344n2d4d5 [400]
3 years ago
15

Andrew paid $30 to buy a potato cannon, a cylinder that shoots potatoes hundreds of feet. He was willing to pay $45. When Andrew

's friend Nick learns that Andrew bought a potato cannon, he asks Andrew if he will sell it for $60, and Andrew agrees, since he would have sold it for $45. Nick is thrilled, since he would have paid Andrew up to $80 for the cannon. Andrew is also delighted. What is the total surplus generated from Andrew’s sale to Nick?
Business
1 answer:
irinina [24]3 years ago
3 0

Answer:

The total surplus from Andrew's sale to Nick is $35.

Explanation:

The total surplus is the sum of producer surplus and consumer surplus.

The consumer surplus is the difference between the maximum price a consumer is willing to pay for a product and the price he/she actually has to pay.

While producer surplus is the difference between the minimum price a producer is willing to accept for a product and the price he/she actually gets.

Consumer surplus for Nick

= $80 - $60

= $20

Producer surplus for Andrew

= $60 - $45

= $15

Total surplus from generated from Andrew's sale to Nick

= $20 + $15

= $35

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Which answer applies to "fine print"?
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Rodriquez Company budgeted the following sales in units: January 30,000 February 20,000 March 40,000 Rodriquez's policy is to ha
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Answer:

24,000 units

Explanation:

Given:

Budgeted sales for January = 30,000

Budgeted sales for February = 20,000

Opening inventory in January = 7,500

Desired ending inventory = 20% of sales in February

                                        = 0.2 × 20,000

                                        = 4,000 units

Units required in January = 30,000 + 4,000

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Units to be produced in January = 34,000 - opening inventory

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Opening inventory in February is closing inventory of January = 4,000

Desired ending inventory = 20% of sales in March

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Units required in February = 20,000 + 8,000

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Units to be produced in February = 28,000 - opening inventory

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                                                         = 24,000 units

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3 years ago
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