Pal\" I: \\ Palaglapn INI )lylei I: \\ :mllng 3. Suppose that the price of student basketball tickets at your college is determined by market forces. Currentli the demand and suiili schedules are as follows: $4 10,000 8,000 8 8,000 8,000 12 6,000 8,000 16 4,000 8,000 20 2,000 8,000 a. Draw the demand and supply curves. Why might the supply curve be shaped the way it is? b. What are the equilibrium price and quantity of tickets? 0. Suppose that the school decides to give away 2,000 student tickets to alumni for free instead of selling the tickets to students. What happens to the supply curve in this scenario? What are the new equilibrium price and quantity? How much money will the school gain/lose in this scenario compared to the original equilibrium you found in (a)? 1. n at It is a hot summer day, and Jon is thirsty. Here is the value he places on each glass of lemonade: Value of first glass $7 Value of second glass $5 Value of third glass $3 Value of fourth glass $1 Dave owns a lemonade stand. Because it takes time to produce large amounts of lemonade, the cost of producing a glass of lemonade rises as he makes more. Here is the cost he incurs to produce each glass of lemonade: Cost of rst glass $1 Cost of second glass $3 Cost of third glass $5 Cost of fourth glass $7 Consider a market in which I on is the buyer and Dave is the seller. a. Use Dave's supply schedule and Jon's demand schedule to nd the quantity supplied and demanded at prices of $2, $4, and $6. Which of these prices brings supply and demand into equilibrium? b. What are the consumer surplus, producer surplus, and total surplus in this equilibrium? c. Suppose the government imposes a price oor on glasses of lemonade. If the price oor is $2, what is the effect on consumer and producer surplus? What about if the price oor is $5? (:1. Suppose the government imposes a price ceiling on glasses of lemonade. If the price ceiling is $2, what is the effect on consumer and producer surplus? What about if the price ceiling is $5