4. [5 points} A colleague glances over your shoulder at the graph below as you are eating lunch at your desk ipping through your notebook. She says: \"Well, obviously, you should produce at Q1 since you maximize prots per unit at that point.\" Another colleague walks by and says: \"You're wrong. The rm should produoe at Q: since that is the breakeven point.\" You tell them they are both wrong and that Q2 is best. Provide an intuitive explanation to your colleagues, explaining why Q1 and Q3 are wrong, and why Q2 is correct. PERFECT CDNIF'E'I'II'IDN IN THE SHORT RUN a MC ATC \"R 01 02 03 Quantity 5. [14 points) The average monthly rent for a 1bedroom apartment in San Francisco ranges from approx imately $2500 to $3700, depending on the neighborhood. A rent control policy setting $2000 per month rent on apartments is being considered in San Ftancisco, where the demand for apartments is given by P = 5000 Q and the supply of apartments is P = 1000 + Q. Here, P = dollars of monthly rent, and Q = number of apartments available rr rent. For purposes of this analysis, apartments are treated as identical. {a} (4 points} What is the current market equilibrium price and quantity before the rent control is imposed? {b} [10 points) Now impose the rent control of P = $2000. Draw a market demand and supply graph and label the equilibrium price and quantity from part {a}, the rent control price, and the number of apartments actually rented under the rent control policy. What is the change in consumer surplus, comparing the market equilibrium to the market with rent control? Label consumer surplus before and after rent control is imposed and show your work. *See next page for questions [6) and (7')