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In Example 9.1, we calculated the gains and losses from price controls on natural gas and found that there was a deadweight loss of $5.68
In Example 9.1, we calculated the gains and losses from price controls on natural gas and found that there was a deadweight loss of $5.68 billion. This calculation was based on a price of oil of $50 per barrel and utilized the following equations: Supply: QS = 15.90 +0.72PG +0.05Po Demand: QD = 0.02-1.8Pc+0.69Po where QS and QP are the quantities supplied and demanded, each measured in trillion cubic feet (Tcf), Pc is the price of rect: 1 natural gas in dollars per thousand cubic feet ($/mcf), and Po is the price of oil in dollars per barrel ($/b). If the price of oil were $60.00 per barrel, what would be the free-market price of gas? With a $60.00 price of oil per barrel, the free-market price of gas would be $ response rounded to two decimal places.) per thousand cubic foot. (Enter your
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