A market has a demand function given by the equation Qd = 180-2p, and a supply function given by the equation Qs =-15+p. The market is government-regulated with a price support per unit and production quotas.(NOTE: a production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota) a). if the price is st at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? considering the price support and the quota, calculate i) the consumer surplus ii). the producer surplus iii). the deadweight loss
A market has a demand function given by the equation Qd = 180-2p, and a supply function given by the equation Qs =-15+p. The market is government-regulated with a price support per unit and production quotas.(NOTE: a production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota) a). if the price is st at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? considering the price support and the quota, calculate i) the consumer surplus ii). the producer surplus iii). the deadweight loss
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A market has a
a). if the price is st at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses?
considering the price support and the quota, calculate
i) the
ii). the producer surplus
iii). the
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