Consider a market with 22 sellers and 21 buyers. Of 22 sellers, there are 15 "high-cost"...

Consider a market with 22 sellers and 21 buyers. Of 22 sellers, there are 15 "high-cost" sellers with production costs of $30 per unit and 7 "low-cost" sellers with costs of $10 per unit. Of 21 buyers, there are 14 "high-value" buyers with values of $40 per unit and 7 "low-value" with values of $20 per unit. For this market, identify and graph the demand and supply curves. Finally, predict the equilibrium price and quantity in the market.

Expert Solution

Rahul Sunny answered 2 years ago

Consider a market with 30 sellers and 30 buyers. Of 30 sellers, there are 10 ”high-cost” sellers with production costs of $25 per unit and 20 ”low-cost” sellers with costs of $5 per unit.

Consider a market with 30 sellers and 30 buyers. Of 30 sellers, there are 10 ”high-cost” sellers with production costs of $25 per unit and 20 ”low-cost” sellers with costs of $5 per unit. Of 30 buyers, there are 15 ”high-value” buyers with values of $30 per unit and 15 ”low-value” buyers with values of $10 per unit.a.) Identify the demand schedule for this market.b.) Identify the supply schedule for this market.c.) Graph the demand and supply schedules for this...

Consider a market for used cars. There are 100 sellers and 100 buyers. The sellers know...

Consider a market for used cars. There are 100 sellers and 100 buyers. The sellers know the qualities of their cars, but the buyers only know that the quality θ of each used card is uniformly distributed over interval [0, 1]. The seller’s value of a car with quality θ is θ. (Thus, market supply is S(p) = 100p for 0 ≤ p ≤ 1 and S(p) = 100 for p > 1.) Each of 50 buyers values a car...

Consider a local used car market with an unlimited number of buyers, 50 sellers of high-quality...

Consider a local used car market with an unlimited number of buyers, 50 sellers of high-quality cars, 30 sellers of medium-quality cars and 20 sellers of low-quality cars. Each seller offers up to 1 car for sale. Sellers of high-quality cars value their car at $15,000, sellers of medium-quality cars at $7,000, and sellers of low-quality cars at $3,000. Buyers value high-quality cars at $20,000, medium-quality cars at $10,000, and low-quality cars at $5,000. Answer the following questions according to...

In a market there are 10 sellers and 4 buyers and the opp cost for seller...

In a market there are 10 sellers and 4 buyers and the opp cost for seller is $3.00 and opp cost for the buyer is $10.00. Then what will be the price that trade will take place at? Explain why. What will a price that buyers will say NO to (if any)? What will be a price that seller will say NO (if any)?

Consider a market in which there are many potential buyers and sellers of used cars. Each...

Consider a market in which there are many potential buyers and sellers of used cars. Each potential seller has one car, which is either of high quality (a plum) or low quality (a lemon). A seller with a low-quality car is willing to sell it for $4,500, whereas a seller with a high-quality car is willing to sell it for $8,500. A buyer is willing to pay $5,500 for a low-quality car and $10,500 for a high-quality car. Of course,...

Consider a market for used cars. There are many sellers and even more buyers. A seller...

Consider a market for used cars. There are many sellers and even more buyers. A seller values a high quality car at 800 and a low quality car at 200. For any quality, the value to buyers is m times the value to sellers, where m > 1. All agents are risk-neutral. Sellers know the quality of their own car, but buyers only know that 2/3 of the cars are low quality and the remaining 1/3 of them are high...

For a market to be competitive, why is it important that there be buyers and sellers...

For a market to be competitive, why is it important that there be buyers and sellers and easy entry and exit?

A market consists of groups of buyers and sellers of a good or service. Market equilibrium...

A market consists of groups of buyers and sellers of a good or service. Market equilibrium represents the price at which the quantity of goods supplied is balanced with the quantity of goods consumers are willing and able to buy. Consider the market for iPads. What could change the quantity of iPads consumers are willing and able to purchase? Identify examples of three events since 2010 that have caused changes in the iPad market's equilibrium. For each event, decide whether...

Suppose for the market for housing that both buyers and sellers expected the price to increase....

Suppose for the market for housing that both buyers and sellers expected the price to increase. Which of the following would result? Group of answer choices Price rises and quantity rises Price falls and quantity is unclear Price rises and quantity is unclear None of the above

Scenario: Suppose a competitive market has ten buyers and ten sellers.

buyerreservation value of buyer ($)sellerreservation value of seller($)11511214223133441246511586106107971288814979161061018Scenario: Suppose a competitive market has ten buyers and ten sellers. The product exchanged in this market is beach hats, which are indivisible. The following table shows the reservation values for both buyers and sellers.a) Refer to the scenario above. If the market is perfectly competitive, the equilibrium price of a hat is?b) Refer to the scenario above. If the market is perfectly competitive, the equilibrium quantity of hats is?

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