2. Individual demand and consumer surplus Consider the market for hyperbaric chambers. The market price of each hyperbaric chamber is $280,000, and each consumer demands no more than one hyperbaric chamber. Suppose that Hubert is the only consumer in the hyperbaric chamber market. Their willingness to pay for a hyperbaric chamber is $490,000. Based on Hubert's willingness to pay, the following graph shows his demand curve for hyperbaric chambers. Shade the area representing Hubert's consumer surplus using the green rectangle (triangle symbols). Hubert's Demand 480 Hubert's Consumer Surplus 420 360 Market Price PRICE (Thousands of dollars) 280 210 140 TO 2 E QUANTITY (Hyperbaric chambers)Now, suppose another buyer, Kate, enters the market for hyperbaric chambers, and her willingness to pay is $350,000. Based on Kate's and Hubert's respective wWingness to pay, plot the market demand curve on the following graph using the blue points (crude symbol). Next, Shade Hubert's consumer surplus using the green rectangle (triangle symbols), and shade Kate'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. SM Demand Curve 350 Hubert's Consumer Surplus Market Price PRICE (Thousands of dollars) Kate's Consumer Surplus TO QUANTITY (Hyperbaric chambers) Suppose Manuel is willing to pay a total of $210,000 for a hyperbaric chamber. True or False: Keeping his maximum willingness to pay for a hyperbaric chamber in mind, Manuel will not buy the hyperbaric chamber because it would be worth less to him than its market price of $280,000. O True Q False3. Consumer surplus for a group of consumers The following graph plots the demand curve (blue line) for several consumers in the market for motor scooters In Meade, a small town located in Kansas. The Meade market price of a motor scooter is given by the horizontal black line at $240. Each rectangle you can place on the following graph corresponds to a particular buyer in this market: orange (square symbols) for Antonio, green (triangle symbols) for Caroline, purple (diamond symbols) for Dmitri, tan (dash symbols) for Frances, and blue (orde symbols) for Jake. Use the rectangles to shade the areas representing consumer surplus for each person who is willing and able to purchase a motor scooter at a market price of $340. (Note: If a person will not purchase a motor scooter at the market price, Indicate this by leaving his or her rectangle in its onlyinel position on the palette.) Antonio Carolina Antonio Dmitri Carolina Market Price PRICE (Dollars per motor scooter Finnous Dmitri 130 Jake QUANTITY [Motor scooters) Based on the Information on the previous graph, you can tell that I will buy motor scooters at the given market price, and total consumer surplus in this market will be$ Suppose the market price of a motor scooter decreases to $120.Based on the Information on the previous graph, you can tell that will buy motor scooters at the given market price, and total consumer surplus in this market will be # Suppose the market price of a motor smoter decreases to $120. On the following graph, use the rectangles once again to shade the areas representing consumer surplus for each person who is willing and able to purchase a motor scooter at the new market price: orange (square symbols) for Antonio, green (triangle symbols) for Caroline, purple (diamond "winbois) for Dmitri, tan (dash symbols) for Frances, and blue (onde symbols) for Jake. (Note: If a person will not purchase a motor scooter at the new market price, Indicate this by leaving his or her rectangle in its original position on the palette.) Antonio Carolina Antonio Dmitri XIX PRICE (Dolars por motor scooter) Dmitri Market Price Jake Frances QUANTITY [Motor scooters) Based on the Information in the second graph, when the market price of a motor scooter decreases to $120, the number of consumers willing to buy a motor scooter to . and total consumer surplus 7 to $4. Consumer surplus for an individual and a market The following graph plots Latasha's monthly demand curve (blue line) for acal bowls. The point denoted by A gives a point along her monthly demand curve. The market price of acal bowls is $2.25 per bowl, given by the horizontal black line. (?) Latecha's Monthly Demand 450 Demand PRICE (Dollars per DOM 10 12 14 16 18 20 QUANTITY (acai bowls) From the previous graph, you can tell that Latasha is willing to pay $ for her oth acal bowl each week. Because she has to pay only $2.25 per bowl, the consumer surplus she gains from the 6th acal bowl b Suppose the price of acal bowls were to fall to $1.50 per bowl. At this lower price, Latasha would receive a consumer surplus of $ from the 6th acal bowl she buys. The following graph plots the monthly market demand curve (blue line) for acall bowls in a hypothetical small economy. Use the purple point (diamond symbol) to shade the area representing consumer surplus when the price (P) of acal bowis is $2.25 per bowl. Then, use the green point (triangle symbol) to shade the ares representing additional consumer surplus when the price falls to $1.50 per bow.Use the purple point (diamond symbol) to shade the area representing consumer surplus when the price (P) of acel bowis is $2.25 per bowl. Then, use the green point (triangle symbol) to shade the ares representing additional consumer surplus when the price falls to $1.50 per bowl. Small Economy's Monthly Demand Initial Consumer Surplus (P = $2.25) A 450 Additional Consumer Surplus [P = $1 50) Demand PRICE UOITS DOT DOW; P = $2.23 P =$1.50 80 100 120 140 180 180 200 QUANTITY [Thousands of acai bowls)5. Producer surplus for a group of sellers The following graph plots a supply curve (orange line) for several sellers in the market for polaroid cameras in College Station, a university town in Texas. Each seller has a single polaroid camera for sale. The market price of polaroid cameras is given by the horizontal black line at $70. Each rectangle on the graph corresponds to a particular seller in this market: blue (circle symbols) for Sean, green (triangle symbols) for Yvette, purple (diamond symbols) for Bob, tan (dash symbols) for Cho, and orange (square symbols) for Eric. (Note: The name labels are to the right of the corresponding segment on the supply curve.) Use the rectangles to shade the areas representing producer surplus for each person who is willing to sell a polaroid camera at a market price of $70. (Note: If a person will not sell a polaroid camera at the market price, indicate this by leaving their rectangle in its original position on the palette.) (?) 160 140 Eric Scar 120 100 Yvelle Cha 80 PRICE (Dollars per polaroid camera) Market Price Bob Bob Cho Sean 2 3 Eric QUANTITY (Polaroid cameras) Based on the information on the preceding graph, you can tell that will sell polaroid cameras at the given market price, and total producer surplus in this market will be SSuppose the market price of a polaroid camera increases to $110. On the following graph, use the rectangles once again to shade the areas representing producer surplus for each person who is willing to sell a polaroid camera at the new market price: blue (circle symbols) for Sean, green (triangle symbols) for Yvette, purple (diamond symbols) for Bob, tan (dash symbols) for Cho, and orange (square symbols) for Eric. (Note: If a person will not sell a polaroid camera at the new market price, indicate this by leaving their rectangle in its original position on the palette.) 160 140 Eric Sean 120 Market Price 100 Cho Yvelle 80 PRICE (Dollars per polaroid camera) Bob EL Bob Yvette Cho 20 Scan 2 3 5 Eric QUANTITY (Polaroid cameras) Based on the information in the second graph, when the market price of a polaroid camera increases to $110, the number of sellers willing to sell a polaroid camera to , and total producer surplus to $