Green et al. (2005) estimate the supply and demand curves for California processed tomatoes. The supply function is: In(Q) = 0 = 0.200+ 0.550 In(p), where Q is the quantity of processing tomatoes in millions of tons per year and p is the price in dollars per ton. The demand function is: In(Q) = 2.600 -0.200 In(p) + 0.150 In(pt), where Pt is the price of tomato paste (which is what processing tomatoes are used to produce) in dollars per ton. Let the price of tomato paste, pt, be $110. Suppose that the government imposes a price support on processing tomatoes at $89 per ton. The government will buy as much as farmers want to sell at that price. Thus, processing firms pay $89. How many tons of processing tomatoes will firms buy? units (million tons per year). (Enter a numeric response using a real number rounded to three decimal places.) G 89 Price, $ per ton Price control Q, Million tons per year D

Green et al. (2005) estimate the supply and demand curves for California processed tomatoes. The supply function is: In(Q) = 0 = 0.200+ 0.550 In(p), where Q is the quantity of processing tomatoes in millions of tons per year and p is the price in dollars per ton. The demand function is: In(Q) = 2.600 -0.200 In(p) + 0.150 In(pt), where Pt is the price of tomato paste (which is what processing tomatoes are used to produce) in dollars per ton. Let the price of tomato paste, pt, be $110. Suppose that the government imposes a price support on processing tomatoes at $89 per ton. The government will buy as much as farmers want to sell at that price. Thus, processing firms pay $89. How many tons of processing tomatoes will firms buy? units (million tons per year). (Enter a numeric response using a real number rounded to three decimal places.) G 89 Price, $ per ton Price control Q, Million tons per year D

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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