Answer:
A. consumer surplus is $20 larger than producer surplus.
Explanation:
Before getting to the little mathematics attached to this, there's a few terms we need to establish.
1. Consumer Surplus - This is simply the difference in price between what consumers are willing to pay and what they end up paying.
2. Producer surplus - This is simply the difference in price between what a producer is willing to accept for a given good or services and how much they actually end up selling the goods for.
Having established those terms,
In this situation,
Consumer surplus = amount consumer is willing to pay - amount consumer pays
CS = 300 - 200
CS = 100
Producer surplus = Amount received - minimum amount producer is willing to receive
PS = 200 - ( 60× 2)
PS = 200 - 120
PS = 80
The difference between consumer surplus and producer surplus
= 100 - 80
= 20
Therefore, consumer surplus is larger than producer surplus by $20.
Answer:
In this case, the differential cost os $18.
Explanation:
<u>The differential cost is the increase in unitary or total production value in two or more steps of the decision-making process. </u>In this case, the unitary cost of product B is not a differential cost. It would remain constant in both products, but, the additional $18 is a cost incurred only in product C.
In this case, the differential cost os $18.
Answer:
If there are only two goods, guns and butter, it is possible to produce more of both goods if the economy is currently operating at an efficient point.
Explanation:
As when an economy is at an efficient point then, the economy will tend to indulge in producing the commodity in which it has an absolute advantage and thus, will later on trade in order to be better off.
In the given instance, the economy is efficient and since the nature of both the goods guns and butter are completely different, thus the economy will produce more of any single product to gain competitive advantage in that product.
Thus, efficient economy also cannot produce both the goods.
Answer:
The answer is "option b".
Explanation:
In this question, choice b is correct because, On a deserted beach, Betty and Ann live. Anna could section 80. or 4 nests of one day's job, and Betty can produce 6 or 2 coconuts. That cost of manufacturing 1 coconut is 2 fish per coconut, which Ann must be skilled for coconuts production.
Answer:
As more people in India have access to higher education, the country's economic growth potential, both in its GDP per capita and in its aggregate demand, will increase.
This is so because the higher the levels of education, the greater the added value that each person introduces into their economic production, with which the country's GDP is in turn increased.
On the other hand, this same economic growth generates a greater availability of wealth for society, with which the greater the availability of money, the greater the demand for goods and services that will be produced in that country.
