Hey! Could you please help with this problem and show me how you solve it please
ID: 2845374 • Letter: H
Question
Hey!
Could you please help with this problem and show me how you solve it please ?
Suppose D(q)= 3(100-q^2) is the price (dollars per unit) at which q units of a particular commodity will be demanded by the market that is all q unitss will be sold at this price ).
Note: (p0 >> some text books refer to it as p bar or p not)
a) find the price p0 at whcih 6 units will be demanded
answer: p0 = ? dollars per unit.
b) compute the consumer's surplus corresponding to this level of output of 6 units.
answer: CS = dollars
Thank you,
Explanation / Answer
1. p0= D(6)= 3(100-36)=192 dollars per unit
2. so to find the consumer surplus, you have to find the area of the triangle created by the price and the demand curve. To do that, you have to find the point where the demand function meets the y axis. Set x to 0 to find this.
3(100 - 0) = D. The price at which quantity demanded is 0 is 300. Find the difference between 192 and 300.
300-192 = 108. Now multiply that by 6 units and divide by 2 since it's a triangle. so 108 * 6/2 = $324