Microeconomics,, 16th Canadian Edition

Price ($ per month) Quantity Demanded (thousands of units) Quantity Supplied (thousands of units) 1100 40 1000 50 900 60 800 70 ...

c. Suppose the maximum rental price is set equal to $500 per month. Describe the effect on quantity demanded, supplied, and exch ...

2.50 250 3.00 200 3.50 150 4.00 100 5.00 0 a. Graph the demand and supply curves. What is the free- market equilibrium in this m ...

a. Calculate the total economic surplus in this market at the free-market equilibrium price and quantity. b. Calculate the total ...

a. Assuming there is no government intervention in this market, what is the equilibrium price and quantity? b. Now suppose the g ...

Consider a simple demand-and-supply model of a competitive labour market in a small town. The demand and supply curves for labo ...

6 Cooperative Behaviour ...

Chapter Outline 6.1 Marginal Utility and Consumer Choice 6.2 Income and Substitution Effects of Price Changes 6.3 Consumer Surpl ...

It is now time to go “behind the scenes” of demand curves to understand why they are downward sloping. So far, we have studied t ...

6.1 Marginal Utility and Consumer Choice Consumers make all kinds of decisions—they choose to drink coffee or tea, to go to a mo ...

utility of consuming five bottles of fruit juice per day is the total satisfaction that those five juices provide. The marginal ...

induce you to reduce it by a second litre? By a third litre? To only one litre consumed per week? The answer to the last questio ...

Figure 6-1 Alison’s Total and Marginal Utility from Drinking Juice Utility Schedules and Graphs In Figure 6-1 we make the assump ...

Total utility rises, but marginal utility declines, as consumption increases. The marginal utility of 20, shown as the second en ...

Maximizing Utility As already noted, economists assume that consumers try to make themselves as well off as they possibly can, g ...

To understand this result, let’s consider an example. Imagine that Alison’s utility from the last dollar spent on juice is three ...

numbers, the marginal utilities from the last dollar spent on X and Y are equal. The condition required for a consumer to be max ...

If we rearrange the terms in Equation 6-1 , we can gain additional insight into consumer behaviour. The right side of this equat ...

this point Alison cannot increase her total utility any further by rearranging her purchases between the two products. Consider ...

demand curves for goods and services. In the next section we derive this result. In recent years, however, behavioural economist ...