AT&T 11:38 AM @ * 76% Document (11) a.. 1. The demand curve for tickets to the G

Question

AT&T 11:38 AM @ * 76% Document (11) a.. 1. The demand curve for tickets to the George Winston concert (with special guest ar, Kenny G) is given as follows: Q-100-01P At a price of $30, what is the consumer surplus from concert tickets? A) So B) $20 C) 5970 D) $2910 E) $47045 Explain Answer 2 Suppose demand is given by O-1000-SOP and supply is given by O-SOP All the equilbrium price and quantity the price elasticity of demand is 0-25 Explain answer .A number of empirical studies of automobile demand yelded the tollowling estimates of income and price elastices Assume that income and price effects on atomoble sales are independent and additive Pssume auto companies average price of the next year and tut neut year's digosable personal roorne isexpected to be 4% higher thw this yoar.. Ifths year's at motale sales were 11 mion urits, how many wud you expect to to sold under each pair of price and income demand elasticity estimates? Study Chow Income Elastcity Price Elasticity 2.5 14 1.5 Roos and Von Saciaki 25 Suits 3.9

Explanation / Answer

Question 1

Demand curve is as follows -

Q = 100 - 0.1P

Calculate the price when demand is zero -

Q = 100 - 0.1P

0 = 100 - 0.1P

0.1P = 100

P = 100/0.1 = 1000

Market price = $30

Calculate the demand at the market price -

Q = 100 - 0.1P = 100 - (0.1*30) = 100 - 3 = 97

Calculate the consumer surplus -

CS = 1/2 * (Price when demand is zero - Market price) * Quantity

CS = 1/2 * (1,000 - 30) * 97 = 47045

Thus,

The consumer surplus from the concert tickets is $47045.

Hence, the correct answer is the option (E).

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