ECON 1051 1nd Edition Lecture 14 Outline of Last Lecture I. Surplus II. Deadweight LossIII. Price ControlsIV. Effect of Externalities Outline of Current Lecture I. Consumer Surplus and Demand Curve Current LectureI. Consumer Surplus and Demand Curvea. The chart below shows the demand curve for ice cream. i. Actual market price for ice cream is at $8 and 90 are sold at this price. ii. The highest price anyone is willing to pay is at $12 (this is the top of the demand curve)1. Using this information we can figure out total consumer surplus byusing the area of the triangle above the actual market price. a. A=1/2(base)(height) b. A=1/2(90)(4)i. 90 comes from the number on the demand curve, 12-8 is the height of the triangle c. A=$180 (consumer surplus) d.These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute. $12Q$8Actual market priceConsumer surplus
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