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Draw a diagram of any one of the four market interventions listed below. Tax Subsidy Price Ceiling Price Floor the graph has to show: Original
Draw a diagram of any one of the four market interventions listed below.
- Tax
- Subsidy
- Price Ceiling
- Price Floor
the graph has to show:
- Original market equilibrium
- The size of the tax or subsidy OR the level of the controlled price (depending on which intervention you choose)
- The final market quantity
- The area of deadweight loss (lost gains from trade) that results from this market intervention (shade it in and label it)
- All other appropriate labels (D, S, P, Q, etc.)
Must be done by hand.
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