Refer to Figure 4-4. What is the value of producer surplus at a price of $18?

In order to maximize its profits, a price-taking firm should produce the level of output at which:

A) total revenue = total cost. B) average revenue = average cost. C) variable revenue = variable cost. D) marginal revenue = marginal cost.

Suppose anyone with a driver's license is capable of supplying one trip from the airport to the downtown business center on any given day. The long-run supply curve of such trips is horizontal at p = $50, which is the average cost of such trips

Suppose daily demand is Q = 1000 - 10p. Calculate the change in consumer surplus, producer surplus and social welfare if the city government requires those people supplying such trips to possess a special license, and the government will issue only 300 licenses.