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Assume there are two types of consumers: type A consumers have a demand Q = 10 ? P for widgets, and consumers of type B have a demand Q = 5 ? P. Assume that there are 10 consumers of each type.
(a) Calculate the market demand.
(b) Assume that the market price for the good is $4 due to perfectly elastic indus- try supply. Using the market demand function, calculate the total consumers surplus.
(c) Calculate the total consumers surplus using individual demand functions.
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