1.The government wishes to encourage students to become more literate in economics and is therefore giving a $10 per unit subsidy to the purchasers of microeconomics textbooks. Given the following demand and supply, what are the economic effects of this subsidy? Illustrate with a diagram. Show work.

P = 100 - Q_d(1)

P = 20 + 3Q_s(2)

Original Price__________________Original Output________________

New Price Consumer Pays_______________New Output___________________

New Price Producer Receives___________________

Benefit to consumer_____________Benefit to producer_____________

Cost to government_____________