Quantity demanded Price Quantity supplied (BDT per cup) 50 40 30 20 800 200 600 400 400 600 200 10 800 100 1000 a) Plot the demand curve and the supply curve for milk coffee in East West University. Show the equilibrium point E“, equilibrium price, P* and equilibrium quantity, Q* in the graph. b) Calculate the value of the consumer surplus and producer surplus at equilibrium. c) What will be the effects on the milk coffee market if a price is set at BDT 40? Calculate and show on the plot in part a.

Quantity demanded Price Quantity supplied (BDT per cup) 50 40 30 20 800 200 600 400 400 600 200 10 800 100 1000 a) Plot the demand curve and the supply curve for milk coffee in East West University. Show the equilibrium point E“, equilibrium price, P* and equilibrium quantity, Q* in the graph. b) Calculate the value of the consumer surplus and producer surplus at equilibrium. c) What will be the effects on the milk coffee market if a price is set at BDT 40? Calculate and show on the plot in part a.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter4: The Market Forces Of Supply And Demand

Section: Chapter Questions

Problem 8PA

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