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For this question, the demand is P = 85 - 3Q & supply is P = 35 + 2Q. To enable more citizens to buy
For this question, the demand is P = 85 - 3Q
& supply is P = 35 + 2Q.
To enable more citizens to buy more gasoline, the
Government decides to give gasoline producers a
subsidy of $10 per unit- Using the supply and demand
equations from #2. What price will consumer's pay and
how much gasoline will they buy? How much will the
Government spend on the subsidy? What will be the
change in producer surplus?
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