Consider in perfectly competitive market the following demand and supply equations for sugar: Qd =1000-1000p where Q d is quantity demanded and Qs is quantity supplied. Qs=800+ 1000p Where P is the price of sugar per pound and Q is thousands of pounds of sugar. (a) Suppose that the government wishes to subsidize sugar production by placing a floor on sugar prices of $0.20 per pound. What would be the relationship between the quantity supplied and quantity demand for sugar? (b) Identify market problem specifically at prices 0.2 per pound and what will be scientific recommendation you suggest to solve the identified market problem?
Consider in perfectly competitive market the following demand and supply equations for sugar: Qd =1000-1000p where Q d is quantity demanded and Qs is quantity supplied. Qs=800+ 1000p Where P is the price of sugar per pound and Q is thousands of pounds of sugar. (a) Suppose that the government wishes to subsidize sugar production by placing a floor on sugar prices of $0.20 per pound. What would be the relationship between the quantity supplied and quantity demand for sugar? (b) Identify market problem specifically at prices 0.2 per pound and what will be scientific recommendation you suggest to solve the identified market problem?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Consider in
Qd =1000-1000p where Q d is quantity demanded and Qs is quantity supplied. Qs=800+ 1000p
Where P is the price of sugar per pound and Q is thousands of pounds of sugar.
(a) Suppose that the government wishes to subsidize sugar production by placing a floor on sugar prices of $0.20 per pound. What would be the relationship between the quantity supplied and quantity demand for sugar?
(b) Identify market problem specifically at prices 0.2 per pound and what will be scientific recommendation you suggest to solve the identified market problem?
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