Question 1 (10 points) Vocab (Unit 5) According to legend, Santa Claus (Q) knows the toy preferences of children around the world. Since Santa alone decides what each child gets, and since the North Pole elves take orders directly from Santa, the North Pole is a prime example of a '/ (traditionalfcentrallyplanned/market) economy By contrast, the First Welfare Theorem of economics implies that the "invisible hand" of the realworld l l {y (traditional/centrally- plan ned/market) economy matches the l 6/ (highest/lowest) cost toy sellers with the l l 15/ (highest/ lowest) value toy buyers. As a result, the same number of toys are delivered to children around the world "as if" Santa Claus actually made and delivered them! Question 2 (10 points) Consumer Surplus (Unit 5) Suppose that the Demand for watches (3) is given by Qd = 227 - 1P, and P* = 34. What is the value of Consumer Surplus? Round your answer to two (2) decimal places YourAnswer: Answer Question 3 (10 points) Producer Surplus (Unit 5) Suppose that the Supply of soccer balls ((23) is given by Q5 = 24 + 4P, and P* = 55. What is the value of Producer Surplus? Round your answer to two (2) decimal places YourAnswer: Answer Question 4 (10 points) Elasticity (Unit 6) A Demand curve is given by Q = 300 - 5 P What is the point elasticity of demand (Ed) at P = 46.27? Round to 2 decimal places Your Answer: Answer D Add attachments to support your work Question 5 (10 points) Vocab (Unit 6) Pretzels (Q?) are a tasty, salty snack item. However, there are plenty of other salty snack items like chips and crackers. These items are i av (complements/substitutes) to pretzels If consumers value all salty snacks equally, then when pretzels become expensive they l l 15/ {will not/will} be willing to purchase pretzels and 15/ (will not/will) want to switch to a different snack. We would therefore conclude that pretzels are l l Q; (elastic/inelastic). Over time as more salty snacks are found, pretzels will become more l l Qy (elastic/inelastic)