Suppose that the demand curve for wheat is and the supply curve is Q = 400-40p Consumer surplus Qs = 40p. The government provides producers with a specific subsidy of s= $2 per unit. How do the equilibrium price and quantity change? The equilibrium price decreases by $ 1 and the equilibrium quantity increases by $ 40 units. (Enter numeric responses using real numbers rounded to two decimal places.) What effect does this tax (subsidy) have on consumer surplus, producer surplus, government revenue, welfare, and deadweight loss? by $

Suppose that the demand curve for wheat is and the supply curve is Q = 400-40p Consumer surplus Qs = 40p. The government provides producers with a specific subsidy of s= $2 per unit. How do the equilibrium price and quantity change? The equilibrium price decreases by $ 1 and the equilibrium quantity increases by $ 40 units. (Enter numeric responses using real numbers rounded to two decimal places.) What effect does this tax (subsidy) have on consumer surplus, producer surplus, government revenue, welfare, and deadweight loss? by $

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Suppose that the demand curve for wheat is
and the supply curve is
QD = 400 - 40p
Consumer surplus
Qs = 40p.
The government provides producers with a specific subsidy of s = $2 per unit.
How do the equilibrium price and quantity change?
The equilibrium price decreases by $1 and the equilibrium quantity increases by $40 units. (Enter numeric responses using real numbers rounded to two decimal places.)
Wh effe does this tax (subsidy) have on consumer surplus, producer surplus, government revenue, welfare, and deadweight lo
by $.

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