Question
A market has a demand function given by the equation Qd=180-2p and a supply function given by the equation Qs=-15+P. The market is government-regulated with
A market has a demand function given by the equation Qd=180-2p and a supply function given by the equation Qs=-15+P. The market is government-regulated with price support per unit and production quotas. ( Note A production quota is a restriction on the quantity of the good that can be produced. firm are not allowed t produce more than the quota)
a) if the price is set at $72 per unit, what production quota is needed to make sure there is no shortage or surplus?
b) considering the price support and quota, calculate the consumer surplus
c) calculate the producer surplus
d) calculate the deadweight loss
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