00:01
So in part a of this problem, we want to find the profit that casey is making.
00:08
So in part a, we know that the total supply, so total supply is equal to 2 ,200 plus 3 ,000.
00:19
So the total supply is 5 ,200.
00:22
We also want the total demand, and this is going to be 4 ,400.
00:34
Now we also want to find the difference.
00:37
So the difference is 5 ,200 minus 4 ,400.
00:42
This is going to be 200 p.
00:45
P is the price.
00:47
And if you solve for p, you get p is equal to four.
00:50
So the new market price is going to be $4 per unit.
00:57
But that is not the answer that we want.
01:00
We want his profit.
01:02
So to calculate the profit, we are going to multiply our four times the quantity.
01:11
So 3 ,000.
01:13
So this is the quantity.
01:19
And we get an answer of what, $12 ,000.
01:24
Now that's the total revenue.
01:27
So total revenue.
01:31
We want to find the total cost as well.
01:34
So the total cost is going to be $2 ,200.
01:36
Times 7, and that gives us 15 ,400.
01:41
So this is total cost.
01:46
Now we want to subtract the total cost from the total revenue...