2. Individual demand and consumer surplus Consider the market for yachts. The market price of each yacht is $200,000, and each buyer demands no more than one yacht. Suppose that Tim is the only consumer in the yacht market. His willingness to pay for a yacht is $320,000. Based on Tim's willingness to pay, the following graph shows his demand curve for yachts. Shade the area representing Tim's consumer surplus using the green rectangle (triangle symbols). Tim's Demand 320 T 280 Tim's Consumer Surplus 240 Market Price 160 - 120 t QUANTITY (Yachts) Now, suppose another buyer, Alyssa, enters the market for yachts, and her willingness to pay is $240,000. Based on Alyssa's and Tim's respective willingness to pay, plot the market demand curve on the following graph using the blue points (circle symbol) Next, shade Tim's consumer surplus using the green rectangle (triangle symbols), and shade Alyssa's consumer surplus using the purple rectangle (diamond symbols) Note: Plot your points as a step function in the order in which you would like them connected. Line segments will connect the points automatically 320 280 Demand Curve 240 Market Price 200 Tim's Consumer Surplus D 180 Alyssa's Consumer Surplus 120 2 80 40 QUANTITY (Yachts) Suppose Brian is willing to pay a total of $160,000 for a yacht. True or False: Keeping his maximum willingness to pay for a yacht in mind, Brian will not buy the yacht because it would be worth less to him than its market price of $200,000 True False