Question

Suppose that in the market of bananas, quantity demanded is represented by Qd = 100 −...

Suppose that in the market of bananas, quantity demanded is represented by Qd = 100 − 2p, and quantity supplied is represented by Qs = 2p + 4. If the government provides a subsidy of $2 per banana, which if the following is correct?

(a) Bananas price fall by $1 and 2 more bananas will be sold

(b) Bananas price will fall by $1, and 2 fewer bananas will be sold

(c) Bananas price will rise by $18 and 2 more banana will be sold

(d) The change in price will depend on whether the subsidy is given to the producer or the consumer

(e) None of the above

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Qd = 240 - 5P Qs = P (a) Where Qd is the quantity demanded, Qs...
Qd = 240 - 5P Qs = P (a) Where Qd is the quantity demanded, Qs is the quantity supplied and P is the Price. Find: (1) the Equilibrium Price before the tax (2) the Equilibrium quantity before the tax (3) buyers reservation price (4) sellers reservation price (5) consumer's surplus before tax (6) producer's surplus before tax (b) Suppose that the government decides to impose a tax of $12 per unit on seller's in the market. Determine: (1) Demand...
Assume that the demand for a commodity is represented by the equation Qd = 300-50P and...
Assume that the demand for a commodity is represented by the equation Qd = 300-50P and supply by the equation Qs= -100+150P where Qd and Qs are quantity demanded and quantity supplied, respectively, and P is price. Using equilibrium condition Qd = Qs, solve the equation to determine equilibrium price and quantity.
Suppose Qd=40-P and Qs= -2+2P. If Price equals 20, quantity demanded will be Question 16 options:...
Suppose Qd=40-P and Qs= -2+2P. If Price equals 20, quantity demanded will be Question 16 options: 22 18 40 10 20 Question 17 (1 point) Suppose Qd=40-P and Qs= -2+2P. What is the equilibrium price in this market? Question 17 options: 14 2 13 20 12.66 Question 18 (1 point) Suppose Qd=40-P and Qs= -2+2P. What is the consumer surplus at equilibrium? Question 18 options: 39 676 169 338 14 Assume at a price of $22, consumer bought 180 units...
Consider a market that can be represented by a linear demand curve, QD = 200 –...
Consider a market that can be represented by a linear demand curve, QD = 200 – 2PD, (where QD is the quantity demanded and PD is the price that demanders pay) and a linear supply curve that QS = ½ PS (where QS is the quantity supplied and PS is the price that suppliers get). a. What is the equilibrium price? b. What is the equilibrium quantity? c. What is demand elasticity at the equilibrium point?
A market is described by the following supply and demand curves: QS = 2P QD =...
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 there is a market at its competitive equilibrium. Demand p = 100 - QD Supply...
Suppose there is a market at its competitive equilibrium. Demand p = 100 - QD Supply p = 20 + (QS /3) The government introduces a subsidy of s = $4 per unit of the good sold and bought. (a) Draw the graph for the demand and supply before subsidy. (b) What is the equilibrium price and quantity before the subsidy and after the subsidy? (c) Looking at the prices buyers pay and sellers receive after the subsidy compared to...
Suppose the corn market has the following equations: QD = 3000 - 400P QS = 900...
Suppose the corn market has the following equations: QD = 3000 - 400P QS = 900 + 300P Where QD and QS are quantity demanded and quantity supplied measured in bushels, and P = price per bushel. Determine consumer surplus at the equilibrium price and quantity. 6 marks Assume that the government has imposed a price floor at $3.50 per bushel and agrees to buy any resulting excess supply. How many bushels of corns will the government be forced to...
55)Suppose Qs is the quantity supplied at a given price for brown rice and Qd is...
55)Suppose Qs is the quantity supplied at a given price for brown rice and Qd is the quantity demanded at the same given price for brown rice. Which of the following market conditions produces an upward movement of the price for brown rice? (a)Qs =1,000, Qd =860 (b)Qs =850, Qd=850 (c)Qs=750, Qd=1,000 (d)Qs=1,000, Qd=1,000 (57)Which of the following pairs of goods would be considered complementary? (a)Coca-Cola and Pepsi (b)Radios and Televisions (c)Computers and computer software (d)Compact discs and cassette tapes...
1. Consider a demand curve of the form QD = 40 - 2P, where QD is...
1. Consider a demand curve of the form QD = 40 - 2P, where QD is the quantity demanded and P is the price of the good. The supply curve takes the form of QS = -4 + 2P, where QS is the quantity supplied, and P is the price of the good. Be sure to put P on the vertical axis and Q on the horizontal axis. a. What is the equilibrium price and quantity? Draw out the supply...
6. Suppose the demand equation can be represented as QD = 1200 – 10p and the...
6. Suppose the demand equation can be represented as QD = 1200 – 10p and the Supply equation by Qs= 10p. a. Solve for the equilibrium price and quantity. b. Say an excise tax of $5 was placed on the buyers. Solve for the price buyers pay, price that sellers receive, and the quantity sold in the market after the tax. Show your work and results graphically. c. Find the deadweight loss, consumer surplus, producer surplus, consumer surplus, and tax...