Table 7-5 For Each of Three Potential Buyers of Oranges, the Table

question 273

Multiple Choice

Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Alex, Barb, and Carlos are the only three buyers of oranges, and only three oranges can be supplied per day.

-Refer to Table 7-5.If the market price of an orange is $0.40,then

• A) 6 oranges are demanded per day, and consumer surplus amounts to $4.45.
• B) 6 oranges are demanded per day, and consumer surplus amounts to $5.10.
• C) 7 oranges are demanded per day, and consumer surplus amounts to $5.35.
• D) 7 oranges are demanded per day, and consumer surplus amounts to $5.50.

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Definitions:

Price Volatile

Characterizes a market or commodity whose price is subject to rapid, unexpected, and often large changes.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded for a given period.

Supply Curve

A graph showing the relationship between the quantity of goods supplied by producers and the price of those goods.

Price Levels

The average of current prices across the entire spectrum of goods and services produced in the economy.