lelot the demand and supply curves of the potato chips market and label them. mm are the equilibrium price and quantity? 'Write your answers here and label them in the graph. 2] Suppose a new dip increases the quantity of potato chips that people want to buy by 30 million bags per week at each price. Fill in column 4 in the table above. Add the new demand curve in your diagram and label it D1. What are the new equilibrium price and quantity of potato chips? {Please indicate the direction of the shift in the curve.) 3] Suppose instead that a Virus destroys potato crops and the quantity of potato chips produced decreases by 40 million bags per week at each price. Fill in column 5 of the table above and add the new supply curve in your diagram. Label the latter as 51. What are the new equilibrium price and quantity for potato chips [Compare the new supply curve with the initial demand curve]? 4] Now suppose the City Council receives a petition from parents in the city complaining of the high price of potato chips. As a result, the Council creates a ceiling that is 10 cents below the equilibrium price in #3. What is the new market price? How many bags of potato chips will be bought each week? How much of a surplus or shortage is created: if any? in a free market: what should happen to the price? 5] Is a price ceiling good or bad economic policy and why? In what ways are buyers and sellers helped or hurt by the price ceiling? Explain. C. MINE'IUM WAGE AND THE MARKET FOR LOW SKILLED WORKERS {It} points] Suppose the Philippine Congress is considering legislation to raise the minimum wage on low skilled workers. 1] What would be the effect of such legislation on the quantity of labor employed? What is the effect on worker surplus and firm surplus? Show these in a grap 2] Is this policy efficient? Does it promote the welfare of lowincome workers? Expl C. TAX INCIDENCE [15 points total, three points each part] Consider the following market supply and demand information for (six-pack of) beer: Price [iii Su I 10!] [1011's of six aclrs [price from consumer to producer] $3 2 4 4 5 6 6 B T 11]