Krugman's Economics

Worksheet 9.1: Graphing Quotas Construct your own graph using the data given below for liquor licenses in the town of Budville. Now, Set a quota at the quantity of 30 liquor licenses per year. Clearly label the quantity demanded and supplied at this quota. Label the deadweight loss. On the graph, show the "wedge". . Explain the "wedge". Price Quantity demanded Quantity supplied $1,000 90 10 2.000 80 20 3.000 70 30 4.000 60 40 5.000 50 50 6.000 40 60 7,000 30 70 8.000 20 80 9.000 10 90