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Suppose Eric is the only seller in the market for bottled water and Bob is the only buyer. The following lists show the value Bob
Suppose Eric is the only seller in the market for bottled water and Bob is the only buyer. The following lists show the value Bob places on a bottle of water and the cost Eric incurs to produce each bottle of water: Bob's Value Eric's Costs Value of first bottle: $10 Cost of first bottle: $1 Value of second bottle: $7 Cost of second bottle: $3 Value of third bottle: $3 Cost of third bottle: $7 Value of fourth bottle: $1 Cost of fourth bottle: $10 The following table shows their respective supply and demand schedules: Price Quantity Supplied Quantity Demanded More than $10 4 0 $7 to $10 3 1 $3 to $7 2 2 $1to $3 1 3 $1 or less 0 4 Use Eric's supply schedule and Bob's demand schedule to find the quantity supplied and quantity demanded at prices of $2, $6, and $9. Enter these values in the following table. Price Quantity Supplied Quantity Demanded 2 [ | L] 6 [ | L] o [ | ] A price of W brings supply and demand into equilibrium. The following table shows their respective supply and demand schedules: Price Quantity Supplied Quantity Demanded More than $10 4 0 $7 to $10 3 1 $3to $7 2 2 $1 to $3 1 3 $1 or less 0 4 Use Eric's supply schedule and Bob's demand schedule to find the quantity supplied and quantity demanded at prices of $2, $6, and $9. Enter th values in the following table. Price Quantity Supplied Quantity Demanded 2 L] L] L] 6 9 1 A price of 9 brings supply and demand into equilibrium. At the equilibrium price, consumer surplus is :' , producer surplus is l:] , and total surplus is l:, . If Eric produced and Bob consumed one less bottle of water, total surplus would If instead, Eric produced and Bob consumed one additional bottle of water, total surplus would
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