college.ca/courses/516/files/folder/Assignments?preview-49289 Person A has deman
ID: 1153665 • Letter: C
Question
college.ca/courses/516/files/folder/Assignments?preview-49289 Person A has demand curve Da -8- P, while person B has demand curve owns 7 units, while person B only owns 4. Db- 13. Pfor some good. Peron A 1. a. What is the equilibrium price at which trade takes place? b. Who is a net seller, who is a net buyer, and by how much? Mr. A and Mr. B have the following respective demands. Pa 25-5x; Pb -11-X, where X is the quantity of good X. 2. a. Graph them on separate graphs. b. Mr. A has no X's while Mr. B has 10 X's. What are their marginal and total values at these quantities? Using either method discussed in the chapter, how much each will have after trade? What will be their marginal 3. What is wrong with the following statement. "If the price of housing goes up to $500,000 then no one will be a SuPPe three countries were self sufficient and produced along a straight-line production possibility curve. values at these quantities? to afford it.Explanation / Answer
Person A has 7 units then Da=8-P
then 7=8-P hence P=1
Similalry for Person B we have Db=13-P
4=13-P
P=9
As Price for A is less than Price for B therefore A is net seller and B is net buyer
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