Background: guided discussion You begin your presentation to the Mayor with some background on the efficiency of the market for hotel rooms in Las Vegas. You estimate that the supply and demand for hotel rooms are described by the following equations: Supply : Q' = 4P – 80 Demand : Q = 100 – 2P (a.) Graph the supply curve and the demand curve. What is the equilibrium price and quantity? (b.) Calculate (and label in the graph) consumer surplus, producer surplus, and total surplus at the equi- librium. (c.) If the Mayor decided to ban all hotel rooms in Las Vegas, who wold bear the larger burden – the buyers or sellers of broccoli?

Background: guided discussion You begin your presentation to the Mayor with some background on the efficiency of the market for hotel rooms in Las Vegas. You estimate that the supply and demand for hotel rooms are described by the following equations: Supply : Q' = 4P – 80 Demand : Q = 100 – 2P (a.) Graph the supply curve and the demand curve. What is the equilibrium price and quantity? (b.) Calculate (and label in the graph) consumer surplus, producer surplus, and total surplus at the equi- librium. (c.) If the Mayor decided to ban all hotel rooms in Las Vegas, who wold bear the larger burden – the buyers or sellers of broccoli?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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