Ask Question
BusinessBusiness
6 August, 05:58

Owen is looking to sell his guitar for nothing less than $60. Suppose Shannon offers him $100, although she was willing to pay up to $130 for it. How much total value is created if Owen accepts this trade?

+4
Answers (1)
  1. 6 August, 06:27
    0
    The total value created is $70

    Explanation:

    In this scenario, the total value created is the total monetary benefit of a consumer and a producer with respect to the sale of a product. It therefore, is the sum of the consumer surplus and producer surplus. It is calculated as follows:

    Consumer surplus = consumer's willing price - market price = 130 - 100 = $30

    Producer surplus = market price - producer's willing price = 100 - 60 = $40

    Therefore, total value created = 40 + 30 = $70
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Owen is looking to sell his guitar for nothing less than $60. Suppose Shannon offers him $100, although she was willing to pay up to $130 ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
3. Norton Manufacturing expects to produce 2,900 units in January and 3,600 units in February. Norton budgets $20 per unit for direct materials. Indirect materials are insignificant and not considered for budgeting purposes.
Answers (1)
The sales department of a consumer products organization realized that its rivals were adopting new customer relationship management software to keep better track of their prospects.
Answers (1)
Benefits are offered by employers to attract good employees. a. True b. False
Answers (1)
Novak Corp. purchased a delivery van with a $67000 list price. The company was given a $5600 cash discount by the dealer, and paid $2900 sales tax. Annual insurance on the van is $1500. As a result of the purchase, by how much will Novak Corp.
Answers (1)
Which of the following does NOT belong to holding costs? A. order processing B. storage costs C. pilferage, scrap, and obsolescence D. insurance on inventory
Answers (1)
New Questions in Business
Dave and betsy have run kozy korner for many years, and from that experience they feel knowledgeable about the most likely threats to the business. however, experience has also taught them that completely unexpected events can happen.
Answers (1)
Firm A and Firm B have the same total assets, ROA and profit margin. However, Frim B has a higher debt ratio and interest expense then Firm A. Which of the following statements is correct? A.) Firm B must have a higher ROE than first A. B.
Answers (1)
You own a portfolio that is 32 percent invested in Stock X, 20 percent invested in Stock Y, and 48 percent invested in Stock Z. The expected returns on these three stocks are 6 percent, 19 percent, and 15 percent, respectively.
Answers (1)
Which of the following statements about knowledge is true? Data and information are the same as knowledge. Knowledge resides in information. Knowledge is the understanding that one gains from information.
Answers (1)
A client with acquired immunodeficiency syndrome (AIDS) develops Pneumocystis carinii pneumonia. Which nursing diagnosis has the highest priority? A. Impaired oral mucous membranes B. Activity intolerance C.
Answers (1)
Home » Business » Owen is looking to sell his guitar for nothing less than $60. Suppose Shannon offers him $100, although she was willing to pay up to $130 for it. How much total value is created if Owen accepts this trade?
Sign Up Forgot Password?