The figure to the right shows the demand and supply curves for the coffee market. The government believes that the equilibrium price is too low and tries to help almond growers by setting a price floor at $7.00. What is the value of producer surplus after the imposition of the price floor? OA. $3,000 OB. $3,600 OC. $4,200 OD. $4,500 1:200 700 SOM 3:00 1.30 Prow for
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- QUESTION 4 1.00 0.90 0.80 0.70 0.60 Supply 0.50 0.40 0.30 Démand 0.20 0.10 50 100 150 200 250 350 400 300 Suppose that a price ceiling of $0,30 is imposed on this market. Which of the following is true? Oa. the ceiling is non-binding Ob. there is a shortage of 150 Oc. there is an excess supply of 150 Od. there is a shortage of 100 unitsQUESTION 6 From Chapter 18 The following table gives data for the market for a product. Price Per Unit Quantity Demanded $1 2 3 4 5 6 7 50 40 30 25 20 15 10 Quantity Supplied 10 20 30 40 50 60 70 Refer to the table above. If an excise tax of $3 per unit is imposed on this product, the new equilibrium price with tax will be: O A. $5 OB. $3 O C. $6 O D. $2Use the graph to answer the question that follows. Price ($) 4 3.5 ✔ 3 2 O $90 What is the value of the producer surplus after the tax in this market? O $180 O $360 O $540 360 O $720 540 Quantity ·S₁ S
- he market equilibrium price for lettuce is $2 per pound. The market equilibrium quantity for lettuce is 30,000 pounds of lettuce. The government decideds to impose a price floor of $3 per pound of lettuce. After the price floor is imposed, the quantity of lettuce supplied will be _____ 30,000 pounds and the quantity of lettuce demanded will be ______ 30,000. The price floor causes a ____ in the market for lettuce. greater than less than surplus equal to shortage80 3.70 73 75 4.00 75 70 4.30 77 65 4.60 79 60 4.90 81 Suppose that the government establishes a price ceiling of $3.70 for wheat. a. What might prompt the government to establish this price ceiling? O To control food prices O To use it as a form of trade barrier O To use it as income support for farmers O To encourage production b. In the diagram below, demonstrate a price ceiling of $3.70. Instructions: Use the tool provided 'Ceiling' to demonstrate a price ceiling of $3.70 for wheat. Plot only the endpoints of the line (2 points total). 5.2 Tools 4.9 Ceiling 4.6 4.3 (75,4.5) 4.0 3.7 3.4 3.1 55 60 65 70 75 80 85 90 Quantity (thousands of bushels) c. Next, suppose that the government establishes a price floor of $4.60 for wheat. What will be the main effect of this price floor? O It will eliminate the market for wheat. O It will create a surplus. O It will create a shortage. O It will establish the equilibrium quantity. Price per bushel ($)The demand and supply for corn is given by D=1000-P and S=3P repsectively. 14) To stabilize corn prices, the government introduced a price floor of $260 and a price ceiling of $380. What will the equilibrium production and consumption levels be? By how much will the consumer surplus change? By how much will the producer surplus change? 15) If the government wants to have the consumption of corn to be 700 units, can it achieve its goal by imposing a per-unit tax on producers or by providing a per-unit subsidy for producers? If yes, find the amount of such tax or subsidy. If not, show an alternative tax or subsidy strategy that can achieve the desired consumption level.
- Suppose 1000units of product A are produced by XYZ limited but the quantity demanded for the product is 2000units. All other things remaining constant,a $18 change in price of product A results in a change in quantity demanded and supplied of 6 and 9 respectively.XYZ has a work force of 500 people who pay an income tax of $200 each to the government. 1.Calculate the new equilibrium price and quantity,suppose the government introduces a subsidy of $10 on each unit of product A.Price 3FE H 0 50 Di Do A BC Quantity Refer to the diagram, which shows demand and supply conditions in the competitive market for product X Other things equal, a shift of the supply curve from 50 to $1 might be caused by a (n) OA decline in the price of the basic raw material used in producing X OB government subsidy per unit of output paid to firms producing X OC.increase in the wage rates paid to laborers employed in the production of X Oo, increase in the number of firms producing XFigure 4-8 $60 50 20 60 70 Quantity (millions of tons) Refer to Figure 4-8. The supply curve S1 and the demand curve D indicate initial conditions in the market for soft coal. A $40-per-ton tax on soft coal is levied, shifting the supply curve from S¡ to S2. Imposing the tax increases the equilibrium price of soft coal from $20 to $60 per ton. $20 to $50 per ton. O $50 to $60 per ton. $50 to $90 per ton. Price (per ton)
- What is the producer surplus after the government levies the $20 sales tax on each yellow bell pepper? Enter the dollar value in the blank below. Repeating the table for convenience: Table 1: Table Price Q. Demanded Q. Supplied $ 20 0 10 20 30 40 50 60 70 80 90 100 110 120 $25 $ 30 $35 $40 $45 $ 50 $ 55 $ 60 $65 $ 70 $75 $80 120 110 100 90 80 70 60 50 40 30 20 10 01. Suppose that the market demand for coffee is Pd = 15 - Qd and the market supply is Ps= Qs - 5. What is the equilibrium price and quantity for coffee? Suppose that the government imposes a tax of $1 per unit to reduce coffee consumption and raise government revenues. What will be the new equilibrium quantity? What price will the buyer pay? What price will the seller receive? A o F2 BE #3 ㅁㅁ F3 $ A t 4 OFFIC DEO DOD 000 F4 % 5 F5 MacBook Air 6 F6 & 7 L * 88. Suppose the total demand for wheat and the total supply of wheat per month in the Kansas City grain market are as shown in the table below. Suppose that the government estab- lishes a price ceiling of $3.70 for wheat. What might prompt the government to establish this price ceiling? Explain care- fully the main effects. Demonstrate your answer graphically. Next, suppose that the government establishes a price floor of $4.60 for wheat. What will be the main effects of this price floor? Demonstrate your answer graphically. LO3.6 Thousands of Bushels Thousands of Demanded Price per Bushel Bushels Supplied 85 $3.40 72 80 3.70 73 75 4.00 75 70 4.30 77 65 4.60 79 60 4.90 81