MATH105 April 2010
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For a particular commodity, the demand curve is
and the supply curve is
Find the consumers' surplus and producers' surplus at the sale level A, where D(A) = S(A).
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How can you find the consumers' surplus and the producers' surplus?
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First we find the sale level A, where D(A) = S(A):
The sale level must be positive, so A = 4. At this sale level, the price is pA = 7.
The consumer surplus is:
The producer surplus is:
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