Question 1: Suppose that: Qs=4P5 QD=4oo.5p Suppose that the Government imposes a price floor of 520. Does this create a surplus or shortage? What is the resulting decline in the Total Surplus in the Economy? What is the Deadweight Loss? Question 2: Tax incidence Suppose still that: Q5 = 4P 5 (1:, = 40 0.5]: Demand is inelastic and therefore is a good target fora revenue-generating tax. Suppose the government imposes a tax of $10 per unit on consumers. How much does the quantity of the good sold decrease, and how much of this tax do consumers and producers each end up actually paving