You are given the following market data for Venus automobiles in ...

[joe]

You are given the following market data for Venus automobiles in Saturnia.
 
  Demand: P = 35,000 - 0.5Q
   Supply: P = 8,000 + 0.25Q
   where P = Price and Q = Quantity.
 
  a. Calculate the equilibrium price and quantity.
  b. Calculate the consumer surplus in this market.
  c. Calculate the producer surplus in this market.

Question 2

Tanesha sells homemade candles over the Internet. Her annual revenue is 64,000 per year, the explicit costs of her business are 17,000, and the opportunity costs of her business are 22,000. What is her accounting profit?
 
  A) 17,000 B) 22,000 C) 47,000 D) 64,000

[kalskdjl1212]

Answer to Question 1

a. Quantity = 36,000: 35,000 - 0.5Q = 8,000 + 0.25Q.; 27,000 = 0.75Q; Q = 36,000.
Price = 17,000: P = 35,000 - 0.5(36,000); P = 35,000 - 18,000; P = 17,000.
b. Consumer surplus = (0.5)(35,000 - 17,

Answer to Question 2

C