Question

Deltra was willing to purchase a dozen cookies for $60 that Deirdre was willing to sell for anything more than $32. If they agreed on a price of $36, how much total value was created in this exchange?

Answer 1

Answer:

$28

Explanation:

The computation of the total value that would be created in the exchange is shown below;

The Deltra surplus is

= Purchase value - agreed price

= $60 - $36

= $24

And, the Deirdre surplus is

= Agreed price - willing to sell

= $36 - $32

= $4

Now the total value created is

= Deltra surplus + Deirdre surplus

= $24 + $4

= $28