Question

Palm oil market is perfectly competitive. Markel supply and demand functions are given by the following equations. Qs = 11,000 + 22P Qo = 99,000 - 18P Where Qs and Qo are quantity supplied and quantity demanded measured in tonnes and Pis the price per tonne measured in RM (0) Tentukan lebihan pengguna dan lebihan pengeluar pada tingkat harga dan kuantiti keseimbangan Determine the consumer surplus and producer surplus at the equilibrium price and quantity (2 markah/marks) (ii) Andaikan kerajaan mengenakan suatu harga minimum pada RM3,000 per tan dan bersetuju membeli lebihan penawaran. Kirakan lebihan pengguna, lebihan pengeluar dan perbelanjaan kerajaan. Tunjukkan kawasan lebihan pengguna dan lebihan pengeluar pada satu rajah. Assume that the government imposes minimum price at RM3,000 per tonne and agrees to buy the excess supply. Calculate the consumer surplus, producer surplus and government expenditure. Show the area of consumer surplus and producer surplus on a diagram (8 markah/marks) TAMAT

draw a graph to explain the ps and cs, thanks, wite clearly.?

Answer 1

Page 2 Os Os = 11000 + 22P 0 11000 [ 500 Qp = 99000 - 18p OD 10 99000 P | 55000 . il at equilibrium, 00 = Qs $99000-18p= 11000+222 → 88000 = 40p ] pt = 2200 Q = 99000 - 18(2200) TQ* = 59400)

Page 2 Snc os Hos 2200 K M PS 1 711000 59400 99000 aplas - 500 (S = 3x (5500 - 2200) x 59400 = 98,010,000 PS =1[2200 - (-500)] x 59400 + (0-(-500))x11000 = 80,190,000 – 2,750,000 = 77,440,000 5500 bookcs 3000 - Price floor 22000 PS - 45000 ap F/1000 T 59400 99000 at p = 3000, QD = 99000 - 13( 3000) = 45.00 SE 1 x 45000 x (5500 – 3000 ) = 56,250,000 Ani و for Producer Surplus, We know are of GFH = know area of GFH = 2 750 000 (part )

at as = 45000 p= 45000 - 11000 Reyes 22 P= 1545,45 So, area of ACTE = 4 x (59400-45000) (22 = I x 14,400 X 654.55 = 4712760 Area of region DCE FQ - Area of rect. DCEJFG- Area of AEJF = (2200% 45000)- _x(45000-11000)x1545.45 399,000,000 - 26,272,650 = 72,727,350 PS = Area of DCEFG + Aree of ABCD = 72727350 + (3000 - 2200) x 45000 = 108,727,350 Ano 1