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Author Question: Suppose the price of an ounce of silver is 100 nuevos soles in Peru and 400 in the United States. ... (Read 99 times)

Zoey63294

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on: Jun 30, 2018
Suppose the price of an ounce of silver is 100 nuevos soles in Peru and 400 in the United States. This implies:
 a. the Peruvian nuevo sol is worth four times the value of a U.S. dollar.
  b. the Peruvian nuevo sol is worth one-fourth the value of a U.S. dollar.
  c. Peru's economy must be four times larger than the U.S. economy.
  d. the U.S. economy must be four times larger than that of Peru.
  e. the U.S. dollar is worth four times the value of a Peruvian nuevo sol.

Question 2

What is producer surplus? How is it different from consumer surplus?


sylvia

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Reply #1 on: Jun 30, 2018
Answer to Question 1

a

Answer to Question 2

Consumer surplus is the difference between what a consumer is willing and able to pay and what a consumer actually has to pay for a good or service. On the other hand, producer surplus is the difference between the price at which a supplier is willing and able to supply and the price a supplier actually receives for selling a good or service.


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Zoey63294

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Reply #2 on: Jun 30, 2018
Thank you :)


sylvia

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Reply #3 on: Jun 30, 2018
Happy to help you


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