The following equations represent the demand and supply curves in the competitive beef market.

QD= 236.775 41.25P

QS = 165P 328.35

where quantities are measured in billions of pounds and price is measured in dollars per pound. (Note these are not the same supply and demand equations from the first problem set.)

a. What are the equilibrium price and quantity?

b. Draw the supply and demand diagram and show the equilibrium price, equilibrium quantity, and consumer surplus. Also, indicate the vertical intercepts of both demand and supply.

c. How big is consumer surplus? (Looking for an actual number here)

d. Please explain what the number you just calculated means. (In other words, what exactly does consumer surplus tell us about a market?)