11. Consider the following reservation values for buyers and sellers of soccer balls.

Buyers Willingness to pay Sellers Willingness to accept Alex $70 Clint $10 Hope $50 Tim $30 Carli $30 Michael $40 Abby $10 Landon $60

a. Sketch the supply and demand. (It will be a step function; see Exhibit 7.2 for an example.)

b. What are the producer surplus, consumer surplus, and social surplus given the market-clearing price of $40?

c. With the goal of making soccer more accessible, the government imposes a $20 price ceiling on soccer balls. What is the new producer surplus? What is the new consumer surplus, assuming Alex is able to buy a soccer ball? What is the social surplus? Based on this, what is the deadweight loss? Highlight deadweight loss on your graph.

d. It is possible that Carli buys a soccer ball given the price floor of $20. If she is able to, what is the deadweight loss of the price ceiling? Is it higher or lower than before? Why?