1.Consider the market for interior designers.

The demand for interior designers takes the following form:

Qd=100-2P, where Q is thousands of interior designers, and P is the price that interior designers receive.

The supply of interior designers takes the following form:

Qs=P-20

a.What will be the equilibrium price and quantity of interior design services?

Now, a government study finds that many consumers have complained about the poor quality of interior designers. In response, the State announces a new law that requires two years of training at an interior design academy is required to work as an interior designer. Moreover, there will only be enough capacity at the academies to train 10,000 designers during the first two years.And, all designers, including experienced ones, must stop working as a designer until they have completed the two-year program. Please answer the following questions, assuming that the training has no impact on designer quality.

b.At the end of two years, what will be the price and quantity in the interior design market?

c.How will this law affect consumers?

d.How will this law affect interior designers?

e.Overall, will this law make the State better off?

How would your answers change (in which direction would they change) if the academies were effective at improving the quality of interior designers?