The table provides information on the demand schedules for train travel for Ann, Beth, and Cy, who are the only buyers in the market.
|
Price
(dollars per kilometre)
|
Quantity demanded
(kilometre)
|
|
Ann
|
Beth
|
Cy
|
|
3
|
30
|
25
|
20
|
|
4
|
25
|
20
|
15
|
|
5
|
20
|
15
|
10
|
|
6
|
15
|
10
|
5
|
|
7
|
10
|
5
|
0
|
|
8
|
5
|
0
|
0
|
|
9
|
0
|
0
|
0
|
a. Construct the market demand schedule.
b. What are the maximum prices that Ann, Beth, and Cy are willing to pay to travel 20 kilometres? Why?
c. What is the marginal social benefit when the total distance travelled is 60 kilometres?
d. What is the marginal benefit for each person when they travel a total distance of 60 kilometres and how many kilometres does each of the people travel?
e. What is each traveler's consumer surplus when the price is $4 a mile?
f. What is the market consumer surplus when the price is $4 a kilometre?