The table below shows the demand and supply schedules for

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The table below shows the demand and supply schedules for sandwiches. Use the

table to answer the following questions:

Price Q Demanded Q Supplied

            Price                                    Q Demanded                        Q Supplied

(dollars per sandwhich)                                  (sandwhiches per hour)

              0                                            400                                        0

              1                                           350                                         50

              2                                           300                                         100

              3                                           250                                         150

              4                                           200                                         200

              5                                           150                                         250

              6                                           100                                         300

              7                                            50                                          350

             8                                             0                                            400

 

a. What is the efficient quantity of sandwiches?

b. What is the consumer surplus if the efficient quantity of sandwiches is produced?

c. What is the producer surplus if the efficient quantity of sandwiches is produced?

d. If Sandwiches To Go Inc. buys all the sandwich producers and cuts production to 100 sandwiches an hour, what is the deadweight loss that is created?

e. If in part d, Sandwiches To Go Inc. rations sandwiches to two per person, is this distribution of sandwiches fair? Explain

 

Reference no: EM13377283

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