Hi Tutor,

Please check my answers to these questions and confirm if the answer and the logic are correct. Thank You,

e. After the price floor is instituted,the Chairman of Productions Office buys up any barrels of gosum berries that the producers are not able to sell.With the price floor, the producers sell 300 barrels per month to consumers, but the producers, at this high price floor, produce 700 barrels per month. How muchproducer surplusis createdwith the price floor?Show your calculations.

70-50=20*200=4000*1/2=2000(50-30) = 20*200=4000*1/2=2000+2000=4000

70-30=40*300=12000(30-0)*300=9000*1/2=4500 +12000=16,500

f. The Chairman of Production's Office buys any barrels of gosum berries that the producers are not able to sell. With the price floor, the producers sell 300 barrels per month to consumers; but the producers, at this high price floor, produce 700 barrels per month.How much money does the chairman of production's office spend on buying up gosum berries?Show your calculations.

(700-300) *($70-$50) = 400*$70= $28,000

g. The Emperor of Gondwanaland must collect taxes from the people to pay for the purchases of surplus gosum berries by the Chairman of Production's Office. As a result, total surplus (producer plus consumer) is reduced by the amount the Chairman of Production's Office spent on buying surplus gosum berries. Using your answers for problems d, e, and f above, what is the total surplus when there is a price floor?Show your calculations.

(D 4500 +E 16500) + F 28000 = 21,000-28000 = -$7000

h. How does this compare to thetotal surplus without a price floorfrom question c above? Is it more, or less, and by how much?

$25,000-$28,000 = -$3000