Reference no: EM13162514

Q. Bert, as a consumer, places the value on a pair of jeans as follows.
Value of first pair: $45
Value of second pair: $33
Value of third pair: $30
Value of fourth pair: $27
Value of fifth pair: $24
Value of sixth pair: $21
Value of seventh pair: $18

Ernie, as a producer, pays the following cost to produce jeans.
Cost of first pair: $12
Cost of second pair: $15
Cost of third pair: $18
Cost of fourth pair: $21
Cost of fifth pair: $24
Cost of sixth pair: $27
Cost of seventh pair: $30
Using the information given above, answer the following questions.

(1) A demand schedule shows the quantity demanded at each of all possible prices, and a supply schedule shows the quantity supplied at each of all possible prices. Using the information given above, construct a table for a demand schedule and a supply schedule of the jeans, and find the equilibrium price and quantity.

(2) Compute the sizes of the consumer and the producer surpluses at the equilibrium price and quantity derived in (1).