Table 5.6 -Refer to Table 5.6.The Equations Above Describe the Demand and the Demand

question 96

Multiple Choice

Table 5.6
-Refer to Table 5.6.The equations above describe the demand and supply for Chef Ernie's Sushi-on-a-Stick.The equilibrium price and quantity for Chef Ernie's sushi are $60 and 20 thousand units.What is the value of consumer surplus?

• A)$100 thousand
• B)$200 thousand
• C)$600 thousand
• D)$800 thousand

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Definitions:

Probability

The measure of the likelihood that an event will occur, often expressed as a number between 0 and 1.

Risk Premium

Higher expected rates of return that compensate investors in risky assets. In equilibrium, differences in the rate of return reflect differences in the riskiness of an investment.

Low Risk Asset

An investment that is generally expected to yield returns with relatively lower volatility or risk of loss.

High Risk Asset

An investment with a high potential for significant loss but also the potential for substantial rewards.