(Figure: Consumer Surplus in the Market for Garden Gnomes I)…
(Figure: Consumer Surplus in the Market for Garden Gnomes I) Consider the figure Consumer Surplus in the Market for Garden Gnomes I. If the price rises from P1 to P2, consumer surplus decreases by the area: (Hint: Please ensure that you calculate the change in consumer surplus here.)
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(Figure: Market for Avocados) The figure shows the market for avocados. If the seller changes the price per avocado from $1.50 to $1.75, the change in total revenue is: (Hint: Use the definition of total revenue = price*quanity here to calculate the change in revenue. For each price, find the corresponding quantity to get to the right answer.)
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