Economics study

Case Study on Consumer & Producer Surplus (20% marks) There are four buyers (Debu, Sumon, Aslam & Rakib) in the market. All of them want to buy a pizza. Debu is willing to pay 800/- taka for one pizza, Sumon is willing to pay 600/- taka for one pizza, Aslam is willing to pay 400/- taka for one pizza, and Rakib is willing to pay 200/- taka for one pizza. On the other hand, there are four pizza sellers in the market (Anup, Roni, Himel & Badal). Anup's cost of producing of one pizza is 200/- taka, Roni's cost of producing of one pizza is 400/- taka, Himel's cost of producing of one pizza is 600/- taka, and Badal's cost of producing of one pizza is 800/- taka. Based on the above information, answer the following questions (you must draw relevant diagrams where needed): Q1 Derive the demand schedule for pizza. Q2 If the market price of one pizza is 450/- taka, what will be market quantity demanded for pizzas and what will be the total consumer surplus? Q3 If the market price of one pizza is 350/- taka, what will be market quantity demanded for pizzas and what will be the total consumer surplus? Q4 Derive the supply schedule for pizza. Q5 If the market price of one pizza is 500/- taka, what will be market quantity supplied for pizzas and what will be the total producer surplus? Q6 If the market price of one pizza is 900/- taka, what will be market quantity supplied for pizzas and what will be the total producer surplus? Q7 Now, considering the demand and supply side of this pizza market, calculate the market quantity demanded and quantity supplied at the market prices of 100/-, 300/- and 500/- taka. Which of these prices brings supply and demand into equilibrium? Q8 What are entire consumer surplus & producer surplus, and total surplus in this equilibrium (ref: question-7)