Use the accompanying graph to answer these questions. s' 20 18 - 16 - 14 - 12 - 10 - 8- 6- 4 - D 2 2 4 Price of X ($)

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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Suppose demand is D and supply is S0. If a price ceiling of $6 is imposed, what are the resulting shortage and full economic price?

Shortage: 

Full economic price: 

Use the accompanying graph to answer these questions.
s'
20
18 -
16 -
14 -
12 -
10 -
8-
6-
4 -
D
2
2
4
Price of X ($)
Transcribed Image Text:Use the accompanying graph to answer these questions. s' 20 18 - 16 - 14 - 12 - 10 - 8- 6- 4 - D 2 2 4 Price of X ($)
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Suppose demand is D and supply is S0. If a price floor of $12 is imposed, what is the resulting surplus? What is the cost to the government of purchasing any and all unsold units?

Surplus:  

Cost to government

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