Assume there are two types of consumers type a consumers, Ask an Expert

Economics

Assume there are two types of consumers: type A consumers have a demand Q = 10 ? P for widgets, and consumers of type B have a demand Q = 5 ? P. Assume that there are 10 consumers of each type.

(a) Calculate the market demand.

(b) Assume that the market price for the good is $4 due to perfectly elastic indus- try supply. Using the market demand function, calculate the total consumers surplus.

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Macroeconomics, Economics

Category:- Macroeconomics
Reference No.:- M9749111

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