6.3 In a competitive market, the market demand curve is Q = 28 - 2p and the...
Question:
6.3 In a competitive market, the market demand curve is Q = 28 - 2p and the market supply curve is Qs = -8 + 2p. Use a spreadsheet to answer the following questions.
a. Determine the quantity demanded and quantity supplied for p = +4, 5, 6, p , 14. Determine the equilibrium quantity and price.
b. For prices p = +4, 5, 6, p , 14, determine the consumer surplus. How does an increase in price affect the consumer surplus?
c. For prices p = +4, 5, 6, p , 14, determine the producer surplus. How does an increase in price affect the producer surplus?
d. Suppose the government limits the quantity traded in the market to 6 units. Calculate the resulting deadweight loss.
Step by Step Answer:
Managerial Economics And Strategy
ISBN: 9780135640944
2nd Global Edition
Authors: Jeffrey M. Perloff, James A. Brander