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The market supply curve for rubber erasers is given by Q_S=1+2P, where quantity is measured in thousands. The demand for rubber erasers can be segmented into two components. The first component is the demand for rubber erasers by art students. This demand is given by Q_D(A)=5/2-P/2 . The second component is the demand for rubber erasers by all others. This demand is given by Q_D(O)=3-2P
(a) Derive the total market demand curve for rubber erasers
(b) Find the equilibrium market price and quantity.
(c) Determine the consumer surplus for each type of consumer
Calculate the returns to scale, marginal productivity, and state which of the functions defines a convex feasible region over their entire usage?
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