Consider a vitamin supplement that is supplied by many difffferent fifirms. The demand curve is =

16 3 and the supply curve is = 4 + 2.

(a) Find the competitive equilibrium.

(b) Compute the consumer surplus and producer surplus.

(c) Scientists discover that a vegetable is rich in this vitamin and the vegetable is not expensive at all.

As a result, the demand curve shifts to = 14 4. The supply curve remains the same. Find the competitive equilibrium after the scientifific discovery.

(d) Compute the consumer surplus and producer surplus after the scientifific discovery.

(e) After making the calculation that you just made, Consultant Bob fifinds that the social surplus de

creases after the scientifific discovery. Therefore, he concludes that the discovery creates a deadweight loss and is detrimental to the society. Evaluate this argument.