8) 9) 10) 1) 12) 13) 14) 15) 16) 17) 18) commodity that will be bought by people at any Find the a the total revenue function and the demand function for harginal function MR = 100 - 9x ind the revenue function and tie demand function if the marginal revenue for x units is MR = 24 ay — x? nue of a commodity is given by MR — 4 — 3x function and the demand function. ‘The marginal Find the reven Be 3 The elasticity of demand with respect to price ‘p’ is Find the demand function and the revenue function when the price is 2 and the demand is 1 The elasticity of demand with respect to price p for a ©, when the demand is x. Find the demand commodity is 4 function and revenue function if the demand is 2 when the price is 3. Find the demand function for which the elasticity of demand is | The marginal cost function of a commodity in a firm is 2 + 3e where x is the output. Find the total cost and average cost function if the fixed cost is Rs.500. 2 The marginal revenue function is given by R(@)= =~ > Find the revenue function and demand function if R(1) =6. The marginal revenue is R’ (x) = 16 —x?. Find the revenue and demand function. The marginal cost of production of a firm is given by C’(x) = 5 +0.13x. The marginal revenue is given by K’(x) = 18 The fixed cost is Rs.120. Find the profit function. The marginal revenue (in thousands of rupees) of a commodity is R(x) = 4+ €°°* where x denotes the number of units sold. Determine the total revenue from the sale of 100 units of the commodity (e? = 0.05) 5.4 CONSUMERS’ SURPLUS ity shows the amount of the ‘A demand curve for a commod u given price P 197Suppose that the prevailing market price is p,. At this price an amount... of the commodity determined by the demand curve will be sold. However there are buyers who would be willing to pay a price higher than p,.. All such buyers will gain from the fact that the prevailing market price is only p,. This gain is called Consumers? plus. It is represented by the area below the demand curve P= fix) and above the line p = p,. Thus Consumers’ Surplus, CS = [Total area under the demand function bounded by y= 0,x=x, and x-axis ~ Area of the rectangle OAPB] cs = ff@a-py, — |— zl % A Quantity a ‘Example 26 aE Find the consumers’ surplus for the demand function p=25—x—x when p, = 19. Solution : . Given that, The demand function is p Po 25-x-x? 19 19=25-x-x? we +x-6=0 (x +3) @-2)=0 x=2 (or) x=-3 x)=2 [demand cannot be negative] PyX, = 19K2=38 UUs cs = freer = PX 0 198Example 27 . The demand of » commodity te p= 28 — x" Find the consumers’ surplus when demand x, = 5 Solution Given that, The demand function, p = 28 — when x, = 5 p, = 28-25 3 Pky = 15 cs = fread -p,x, a 5 = J(28-)dr - 1 3 = fpsx-¥] -15 2B 250 = [28x5-—>] - 15 = SP units , Example 28 VY The demand function for a commodity isp the consumers’ surplus when the prevailing market 199Solution Given that, Demand function, p - Pyro or 2v46 3 => px,=6 12 [log x4 aye 6 !2[log 6 ~ log 3] -6 12log£ ~6= 17 og 2-6 5.5 PRODUCERS’ SURPLUS A supply curve for a commodity commodity that will be brought into the Suppos shows the amount of the market at any given Pricep. the prevailing market price is p,. At this price an amount x,, of the commodity, determined by the supply curve. will be offered ‘0 buyers, However, there are producers who are willing to supply the commodity at a price lower than Py All such producers y gain from the fact that the prevailing market price is only p gain ts called ‘Producer Surplus’. It is represented by 1 Ie above the supply cur C p= g(x) and below the line p= p,, Thus Producers Surplus, PS ~ [ Area of the whole rect ingle OAPB ~ Area under the supply | curve bounded by v= 0, y= y andy ~ axis] | PS © py Fxample 29 The supply function for a commodity ispext ave $ where x denotes supply. Find the producers* surplas when the price is 10, 200Solution Given that Supply function, p =? + ay +5 For p, = 10, Wax 44r+5 = 4+4x-5=0 > @45)@-1)-0 = 2=-5 or xa] supply cannot be negative, x = ~5 is not possible. x= py - Wandx,=1 => p,x,=10 Producers Surplus, PS= pax, Peco ax 10 10 [xr + 4x + 5) de 3 ~10- esas = 10~[ 4 4245] = © units, 3 3 ‘ample 30 ZY Find the producers’ surplus for the supply function p=x'+x+3 when x,=4. Solution Given that, supply function p =x? +x +3 whenx,=4, p,=4+4+3=23 Pky = 92. Producers’ Surplus Xx 4 PS=pyty- feladde =92- [Oe +x +3) dr 0 0o 2010 pew 4 ar! 92 -[ 94 + 1S 12) = 12 units [samp Find the producers’ surplus for the supply function p=3 +x? when the price is 12. Solution Given that, supply function, p= 3 +22, When p, = 12, 12=34x? or x? =9 orx=43 Since supply cannot be negative, x =3. ie x)=3, PX, = 36. Producers’ Surplus, PS=p,x,- [ g(x)de a 0 3 =36- [3 +x) ar =36- Bre = 36 - [9+ 22-0] = 18 units Example 32 The demand and supply functions under pure competition are p, = 16 — x? and p, = 2x? + 4. Find the consumers’ surplus and producers’ surplus at the market equilibrium price. Solution : For market equilibrium, Quantity demanded = Quantity supplied = 16-x2=22+4 = 3x? = 12 > w=4 => x =+2 > Butx =—2 is inadmissible. a a (ie.) x,= 2 202Py 16 Qay 12 PoXo 2x2 a4 Consumers? Surplis CS { 1) dy ; PoXy Joya 24 j x? fsx Producers’ Surplus ty PS = pyx 8) dx 24- fow +4)dx = 24 pe ' anf. lo EXERCISE 5.4 1) If the demand function isp = 35 — 2x 3, find the consumers’ surplu 2.) If the demand function for a commodity is p consumers’ surplus for p, = 11. 3) The demand function for a commodity isp consumers’ surplus for (i) p = 2 (ii) p = 6. 4) — The demand function for a commodity isp the consumers’ surplus for p = 20. 5) If the supply function is p = 3x° + 10 and x, = 4, find the producers” surplus. 6) If the supply law is p = 4 — x + x’, find the producer when the price is 6. 7) The supply function for producers’ surplus when (i) x, 203 x? and the demand x, is 36 — x? find the 10~ 2x. Find the = 80— 4x —x°. Find rs’ surplus commodity is p= 3 + x. Find the 3. (i) xy = 6x) 9 10) nn) 12) 13) 14) 15) For a cor "Commodity, the supply | producers” Producers’ surplus when the pr The dema jaw is p =4 +3. Find the ice is § ater i Supply function for surphis 4 commodity are p,,~ 16-2 ers’ surplus and producers: 1 te Eind the consum a the marke the market equilibrium price The dey demand a 1d and supply law under a pure competion are given wl ota ae em : aU the market equilibrium price Under pure competition the demand and supply laws for commodity and p,= 56 — x? and p,= 8 +2. Find the Consumers’ surplus and producers’ surplus at the equilibrium price Find the consumers’ surplus and the producers” surplus under market equilibrium if the demand function is p, = 20 — 3x —x and the supply funetion is p, = x ~ 1 In a perfect competition the demand and supply curves of a commodity are given by p, = 40 ~ x? and p, = 32 + & 48. Find the consumers’ surplus and producers’ surplus at the market equilibrium price. ‘The demand and supply function for a commodity are given by p, = 15~xand p, = 0.3x +2. Find the consumers’ surplus and producers” surplus at the market equlibrium price ‘The demand and supply curves are given by p,~ 18 and p,~%. Find the consumers’ surplus and producers’ surplus at the market equilibrium price. EXERCISE 5.5 Choose the correct answer 1) a If /00) is an odd function then f f(x) dx is (a) 1 (b) 2a (c)0 (d)a 204