Question

**1. Suppose the demand for village defense in Temeria is
Qd=300-2P, and the supply is Qs=4P.**

a. Graph the supply and demand curves. (3 points)

b. Solve for the equilibrium price and quantity. Show this point on your graph from part (a). (5 points)

c. How much consumer surplus is created in this market? How much producer surplus? (4 points)

d. Suppose the King of Temeria puts a tax of 10 orens per unit on village defense. Write an equation showing the relationship between the price paid by consumers and the price received by sellers. (2 point)

Answer #1

Suppose the demand for pickles on The Citadel is Qd=500-4P, and
the supply is Qs=6P. Assume this market is perfectly
competitive.
d. Suppose the Council puts a tax of $5 per unit on the purchase
of pickles. Write an equation showing the relationship between the
price paid by consumers and the price received by producers.
e. Find the new (after-tax) equilibrium quantity of pickles,
price paid by consumers, and price received by producers.
f. How much consumer surplus is created...

Consider the following market for
board games: (Do NOT round values)
Qs= -20+4P Qd= 300-P
a) Calculate initial equilibrium
supply and demand.
b) Calculate consumer and producer
surplus. Show graphically.
c) Since board games make the world
a better place, the government puts a $30 subsidy on all board
games. Recalculate new equilibrium prices and quantity.
d) Show (c) in a graph and calculate
consumer surplus, producer surplus, government cost and deadweight
loss. Show these in the graph.

Consider the following market for
board games: (Do NOT round values)
Qs= -20+4P Qd= 300-P
a) Calculate initial equilibrium
supply and demand.
b) Calculate consumer and producer
surplus. Show graphically.
c) Since board games make the world
a better place, the government puts a $30 subsidy on all board
games. Recalculate new equilibrium prices and quantity.
d) Show (c) in a graph and calculate
consumer surplus, producer surplus, government cost and deadweight
loss. Show these in the graph.

Suppose that the demand and supply functions for good X
are:
Qd = 298 - 8P and
Qs = - 32 + 4p
A. Find the equilibrium price and quantity.
B. Sketch this market. [HINT: Be sure to draw the two curves
carefully, using inverse demand and supply functions to calculate
the quantity- and price-axes intercept points.]
C. Use the demand function to calculate consumer surplus.
D. Use the supply function to calculate producer surplus.
E. What is the total...

1) Suppose the domestic supply (QS U.S.) and demand (QDU.S) for
bicycles in the United States is represented by the following set
of equations:
QS U.S. = 2P
QDU.S. = 200 – 2P.
Demand (QD) and supply (QS) in the rest of the world is
represented by the equations:
QS = P
QD =160 – P. Quantities are measured in thousands and price, in
U.S. dollars. After the opening of free trade with the United
States, if the world price...

1. The market demand and supply was given as follow: Qd = 10 –
2P Qs = -5 + 3P
a) Compute for the Price equilibrium
b) Compute for the Quantity equilibrium
c) Plot/graph the following equation.
2. Given the equation, find the equilibrium price and quantity
of the following market and plot the equation. 13P – Qs = 27 Qd +
4P – 24 = 0

Suppose that a market is described by the following supply and
demand equations:
QS = 2P
QD = 400 - 3P
Solve for the equilibrium price and the equilibrium
quantity.
Suppose that a tax of T is placed on buyers, so the new demand
equation is
QD = 400 – 3(P+T)
Solve for the new equilibrium. What happens to the price
received by sellers, the price paid by buyers, and the quantity
sold?
Tax revenue is T x Q. Use...

A market is described by the following supply and demand
curves:
QS = 2P
QD = 400 - 3P
Solve for the equilibrium price and quantity.
If the government imposes a price ceiling of $70, does a
shortage or surplus (or neither) develop? What are the price,
quantity supplied, quantity demanded, and size of the shortage or
surplus?
If the government imposes a price floor of $70, does a shortage
or surplus (or neither) develop? What are the price, quantity...

Suppose demand and supply can be characterized by the following
equations:
Qd = 6 – 2P
Qs = P
Price is in dollars; quantity is in widgets.
For parts (a) and (b), assume there is no tax. Show your work
for each step below.
Find the equilibrium price and quantity algebraically.
Calculate the following:
consumer surplus
producer surplus
total firm revenue
production costs
For parts (c) and (d), assume a tax of $1.50 per widget sold is
imposed on sellers....

Suppose the demand curve is given by Qd=75-5P and the supply
curve is given by Qs=P-3. SHOW YOUR WORK in the space below (type
it out, line by line), and solve for the equilibrium price, the
equilibrium quantity, the consumer surplus, the producer surplus,
and the total surplus.

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