i) Suppose the market demand function in a certain market where Q is measured in thousands of units is Qd = 20 - 2.5P, and the market supply function is Qs = 2.5P - 7.5. How much deadweight loss would there be in this market if the quantity bought and sold was 6,000 units?
a) $0.03
b)$25
c)$2500
d)$500
ii) At 8,500 units?
a) $2.03
b) $4.05
c) $1800
d) $2025
i) Suppose the market demand function in a certain market where Q is measured in thousands...
1. Potato growers have a mandatory demand expansion program where all growers pay a certain amount to fund a promotion program for tomatoes. You have estimated the following market supply and demand functions for potatoes, which include a demand shifter for generic potato promotion: Qd = 15 - P + 0.1PROM Qs = 5 + 2.5P TC = 0.2Qs where: Qd = quantity demanded of potatoes, measured in million pounds, P = price of potatoes measured in $ per pound,...
Suppose that the market for a children’s book is given by the following demand and supply functions: Demand: QD= 98 - 4P Supply: QS= -4 + 2P Where: QD and QS are quantity demand and quantity supplied respectively, and P is the price. The equilibrium quantity is ______ units
Consider a perfectly competitive market where Demand is described as Qd 100-2P. a. If the market price is 10, how many units are consumed in the market? What is the consumer surplus in the market? b. Suppose the market Supply is described as Qs 10 P. What is the equilibrium price in the market? Quantity? C. Suppose the market Supply is described as Qs 10+ P. What is the excess quantity supplied in the market at P demanded in the...
The market for rice in a country has the following demand and supply functions: Demand function: P = 6 – 0.5QD Supply function: P = 2 + 0.5QS Where QD is the quantity demanded, QS is the quantity supplied and P is the unit price of rice. Determine the equilibrium price, quantity, consumer surplus and producer surplus in the rice market. Illustrate your answers with a suitable rice market diagram. (8 marks) To help the rice farmers, the government has...
For Question 1-8, consider a competitive market for a good where the demand curve is determined by the demand function: P=5-QD and the supply curve is determined by the supply function: P=QS. Where P stands for Price, QD is quantity demanded and QS is quantity supplied. What is the equilibrium price level for the good in the competitive market?
Q3) Suppose that the market demand and supply curve in a competitive market are Q"-15 - 2P and QS-P. For each of the following policies, calculate the price and quantity that will be traded and the value of the deadweight loss. a) An excise tax of S1 per unit, paid by producers. b) A subsidy of $2 per unit, paid to consumers. c) A price floor of S7. d) A price ceiling of S4. e) A production quota of 3...
9.10. The domestic demand for portable radios is given by Demand: Q = 5,000-100P where price P is measured in dollars and quantity Q is measured in thousands of radios per year. The domes tic supply curve for radios is given by Supply: Q-150P a. What is the domestic equilibrium in the portable radio market? b. Suppose portable radios can be imported at a world price of $10 per radio. If trade were unencumbered, what would the new market equilibrium...
1) Assume that the market demand and supply functions for Nice to See book factory shelves are: QD = 720 - 12P (Market Demand) QS = -240 + 20P (Market Supply) where QD is the market demand of book shelves, QS is the quantity of book shelves produced and P is the market price per unit. (i) Calculate the equilibrium quantity and price for the book shelves before and after the imposition of a RM15 per unit tax. (12 marks)...
Suppose that in the market for lemons, demand is given by the function Do: QD = 20 – 2P , and supply is given by the function So: QS = (-1) + 3P . Use this information to answer the following questions (round to the nearest hundredth if needed). 1.) What is the equilibrium price in this market? 2.) If a price ceiling of P = 2.8 is imposed on this market, what will the market price be? 3.) How...
1. Consider the market for apples where the market demand is given by QD = 30 − 2p and market supply is given by QS = P Find the market equilibrium. What will be the quantity traded if an excise tax of $2/unit is imposed? Calculate the deadweight loss of the excise tax. 2. Consider the same market from question #1. Consider that you are the only seller in that market and you produce apple for a marginal cost of...