The market for Brussels Sprouts in California is represented by the equations below. Q is measured in thousands of bushels.
P = 9 – Qd P = 2Qs
PLEASE SHOW STEPS :)
Imagine the government of California is considering placing a price floor of $8 per bushel on brussels sprouts.
Now let’s look at how Consumer, Producer, and Total Surplus are affected by this policy.
a) Set QD=QS
9-Q=2Q
9 = 3Q
Q = 9/3 =3
P = 9-3 =6
b) When QD=0, P=9 and When QS=0, P =0
c) Yes, this is a binding price floor as a binding price floor is imposed above the equilibrium price
d) When P=8,
QD: 1
QS: 4
e) As quantity demanded is lower than the quantity supplied so, there exists a surplus in the market
Surplus = QS-QD = 4-1 =3 units
The market will have a deadweight loss as equilibrium quantity will fall equal to the quantity demanded and quantity sold = quantity demanded = 1
As per Chegg guidelines, more than four parts are answered.
The market for Brussels Sprouts in California is represented by the equations below. Q is measured...
The wheat market is perfectly competitive, and the market supply and demand curves are given by the following equations: QD = 20,000,000 - 4,000,000P QS = 7,000,000 + 2,500,000P, where QD and QS are quantity demanded and quantity supplied measured in bushels, and P = price per bushel. a. Determine consumer surplus at the equilibrium price and quantity. b. Assume that the government has imposed a price floor at $2.25 per bushel and agrees to buy any resulting excess supply. How many bushels of wheat...
4. Suppose the market for grass seed can be expressed as: Demand: Qd = 200 - 5P Supply: Qs = 40 + 5P If the government collects a $5 specific tax from sellers (here you can change the supply equation to Qs = 40 + 5(P-t) or Qs = 15+ 5P, How much will the quantity demanded change from the amount demanded before the tax? What price will consumers pay after the tax? What price will sellers receive after the...
Q. Given the following supply and demand functions, calculate consumer surplus. P = 600 − Qd P = 300 + 2QS Q. Consider the market for jet fuel in a remote regional airport. The domestic demand and supply curves are given as (Qs are gallons in thousands): P = 55 − 3QD P = 5 + 7 QS a) What is the market equilibrium price and quantity? b) If the government imposes a price ceiling of $28, what will be...
Suppose the market demand and supply curves are represented by the following equations: Qd = 100 – 0.25P Qs = 40 + 0.25P PART A I already did: a. Determine the equilibrium price and quantity. (Show your calculations) [2 marks] Price can be calculated QD=QS 100- 0.25P = 40+ 0.25P Rewritten as: 60 = 0.5 Price= 120 Quantity can be calculated: QD = 100 – 0.25 (120) = 70 B) illustrate these curves on a graph, labelling these curves, intercepts...
E) Solve the mathematical problems below: 1. The demand and supply curves for hotdogs in California are given by the following two equations QD = 8,000 - 800P QS = 2,000 + 200P Where QD represents quantity demanded, QS represents quantity supplied and P represents price. a. Find the equilibrium quantity and price: b. If students suddenly acquire a greater taste for hotdogs, which of the following would be the new demand curve? Circle the correct equation: QD = 6,500...
The demand and supply conditions of market for beer are given by the following equations: Qd = 72 - P and Qs = -18 + P a) Find the initial equilibrium price and quantity. b) Calculate the consumer surplus and producer surplus for the equilibrium. c) Suppose that government impose a price floor at P=66 to control the consumption of beer. Is this policy effective? What are price and quantity consumed after this intervention of government? d) Going back to...
Macroeconomics d. Did the increase in production costs cause a "decrease in supply" or a "decrease in quantity supplied"? 3. Refer to the following expanded table from review question 8. LO3.4 a. What is the equilibrium price? At what price is there neither a shortage nor a surplus? Fill in the surplus-shortage column and use it to confirm your answers. b. Graph the demand for wheat and the supply of wheat. Be sure to label the axes of your graph...
Assume that the market demand and supply curves for soybeans grown in Canada can be represented via the following: QD = 40?0.5PS QS = 2.5+2.5PS (1) where PS is the soybean price ($/bushel) and QS is the quantity of soybeans produced (de- nominated in 100 million bushel units). (a) What is the equilibrium price, PS?, and quantity, Q?S, of soybeans? (b) Using Excel or some other spreadsheet program verify your answer to (a) graph- ically.
Homework 2: Welfare Analysis 1. Let's say that the market for barley in the US is: Demand function: Q = 4 - VP: Supply function: Q = P-4 where P is price in S/bushel and Q is quantity in millions of bushels sold. Find the equilibrium price and quantity for this competitive market solution and graph it. Let's say that the world price is $7/bushel. Calculate and show graphically the amount produced domestically and the amount consumed domestically Using letters...
Assume that a competitive market is currently represented by the following supply and demand equations: Qs 4P - 404N Qd 110- P 5C Pis theprice of the product, Nis the number of producers, and Cis the number of consumers There are currently 10 producers and 2 consumers. 1. (2 Points) Solve for the equilibrium price and quantity given the current number of producers and consumers. 2. (2 Points) Write the equilibrium price and quantity in a general form that allows...