Suppose the demand curve for a consumer for coffee isq 6 -, Ask an Expert

Economics

Suppose the demand curve for a consumer for coffee is:

Q = 6 - 2P,

where Q represents the number of cups per day and P is the price of coffee per cup.

1. Suppose the consumer is at coffee shop 1. Coffee shop 1 charges $2.00 per cup.

- Draw and label the demand curve for a cup of coffee for the consumer (please do not forget to specify the intercept of the demand curve for each of the axes).

- How many cups would she drink a day and how much would she spend a day at coffee shop 1? Explain your answer and illustrate it on the graph. Hint: I would draw the incremental price of drinking a cup of coffee at the shop to show the number of cups the consumer chooses.

- What is the consumer surplus and the average price per cup?

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M9533037

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