Practice QuestionsCh 7.1 A market for milk in a certain countly exhibits a linear demand curve, with an annual quantity demanded of 8 million liters at a price of $1 per litre, 6 million at a price of $2, 4 million at a price of $3, 2 million at of price of $4 and zero at a price of $5. The supply curve for milk in this country is also linear, with zero litres supplied annually at a price of $1 per litres, 2 million at a price of $2, 4 million at a price of $3, 6 million at a price of $4, and 8 million at a price of $5. (a) Create a table showing all data of milk demand and another table of milk supply and draw the demand and supply curve. (KU: / 2) (b) Use your graph to calculate the consumer smplus and producer surplus in the market at a price of 3.(T: /2) (c) Existing milk producers are allowed by the country's government to restrict output which causes the price of milk to rise to $4 per litre. On your graph, show the deadweight loss resulting from this policy. (A /2) (d) Using the concepts of consumers surplus and producer surplus, explain which groups benet and which groups loss as a result of this policy. Is overall economic welfare in this market increased or decreased