Question

- Consider a perfectly competitive market in the short-run with the following demand and supply curves, where P is in dollars per unit and Q is units per year:

**Demand: P = 500 –
0.8Q**

**Supply: P = 1.2Q**

- Calculate the short-run competitive market equilibrium price and quantity. Graph demand, supply, and indicate the equilibrium price and quantity on the graph.

- Now suppose that the government imposes a price ceiling and sets the price at P = 180. Address each of the following questions:

- Draw the price ceiling line on your graph above.
- At P = 180, what is the excess demand (quantity demanded minus the quantity supplied)? Label the quantity demand and quantity supplied at P = 180 on your graph above.
- What is the deadweight loss (DWL) to consumers from the price ceiling? Show your calculations and label or shade the area of DWL in your graph above.

Answer #1

The corn market is perfectly competitive, and the market supply
and demand curves are given by the following equation: Qd
=50,000,000 – 2,000,000 p Qs = 10,000,000 +5,500,000 p Where Qd and
Qs are quantity demanded and quantity supplied measured in bushels,
and P= price per bushel.
1) Determine consumer surplus at the equilibrium price and
quantity.

A market is described by the following supply and demand
curves:
QSQS
= =
3P3P
QDQD
= =
400−P400−P
The equilibrium price is______
and the equilibrium quantity is_______
.
Suppose the government imposes a price ceiling of $80. This
price ceiling is (binding or not binding) , and
the market price will be
. The quantity supplied will be______
, and the quantity demanded will be_____
. Therefore, a price ceiling of $80 will result in (a
shortage, neither a shortage nor...

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...

Consider a perfectly competitive market in which the market
demand curve is given by
Qd = 10 – 2Pd, and the market supply curve is
given by QS = 2PS.
a. ) Find the equilibrium price and quantity in the absence of
government
intervention. Graph it.
B.) Suppose the government imposes a price ceiling of $3 per
unit. How much is supplied?
C.) Suppose, as an alternative, the government imposes a
production quota limiting the quantity supplied to six units....

Assume the market is competitive and the supply slopes up and
the demand curves slopes down are (neither is entirely horizontal
or vertical). Answer true/false/uncertain and
explain: removing a binding price ceiling would increase
quantity supplied, decrease quantity demanded and increase the
price demander’s pay.

Suppose in Diamond Land people mine diamonds, and you have a
demand and supply curve for diamonds, where P is the price of
diamonds and Q is the quantity demanded for diamonds (in
pounds):
P=300-0.5Q
P=100+0.5Q
Please find the equilibrium price and quantity for diamonds.
Please graph supply and demand curves and show the equilibrium
price and quantity demanded on the graph. Please also label the
axes, intercepts, and curves.
Suppose the government of Diamond Land wants to implement price...

3. Consider a competitive market with the following demand and
supply curves: ?? = 600−100?, ?? = −150+150?
b. If government imposes a price of P5.00, is this a price ceiling
or price floor? Will there be a shortage or surplus? If so, by how
much will the shortage or surplus be?

Assume the market can be described by the following supply and
demand curves.
Qs=2p
Qd=300-p
A. Solve for the equilibrium price and equilibrium quantity.
Sketch this market.
B. Solve for the consumer surplus and producer surplus in this
market.
C. If the government imposes a price ceiling of $90, does a
shortage or surplus (or neither)
develop? What are the price, quantity supplied, quantity
demanded, and the size of the
shortage or surplus (if one exists and the answers differ...

Consider a perfectly competitive market for rental housing. The
monthly (inverse) demand and supply functions for rental units are
given by P = 70 – 0.7QD & P = 10 + 0.3QS, where P is monthly
rent, and Q is the number of rental units. Note: Each numerical
value MUST be rounded to ones. ex) 34.3 --> 34 or 1.5 -->
2
Part a) Using the given inverse functions above, compute the
equilibrium price and quantity.
Q* =
P* =...

A market has supply and demand curves that follow the following
set of equations: Supply → P = 4QS + 10 Demand → P = -5QD + 280.
For both of these problems pictures are not required but the
problems may be much easier if you draw some.
a) Find the equilibrium price and quantity in this market and
the consumer and producer surplus from the equilibrium price and
quantity. (1 point)
b) If there is a ceiling price in...

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