The following table displays the reservation values of eight buyers and eight sellers, who each want to buy or sell a calculator. You are in charge of deciding which buyer trades (or not) with which seller at what price as you see fit. You could prescribe different prices to each pair of a buyer and a seller.
-Refer to the table above.Suppose you want every buyer to be able to get a calculator without paying more than his or her reservation value.Is it possible? If so,what would be the total surplus?
Definitions:
Direct Labor Time Variance
The difference between the actual time spent on production and the estimated standard time, multiplied by the standard labor rate.
Direct Labor Rate Variance
The difference between the actual cost of direct labor and the expected (or budgeted) cost, based on standard rates and actual hours worked.
Actual Costs
The real financial expenditures that a company incurs, as opposed to budgeted or estimated costs.
Standard Materials Quantity
The predetermined amount of materials expected to be used in the production of a single unit or a batch of product, under normal conditions.
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