A market has a demand function given by the equation Qd = 180-2p, and a supply function given by the equation Qs =-15+p. The market is government-regulated with a price support per unit and production quotas.(NOTE: a production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota) a). if the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? Due to good weather, there is an increase in the demand for the good. the new demand equation is qd=190-2p. The government is trying to decide between two options: * Maintain the number of quotas and let the market adjust, or * Maintain the price support and increase the number of quotas (i). Which of the two options would be preferred by the producers? (ii) Which of the two options would be preferred by society on a whole?

A market has a demand function given by the equation Qd = 180-2p, and a supply function given by the equation Qs =-15+p. The market is government-regulated with a price support per unit and production quotas.(NOTE: a production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota) a). if the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? Due to good weather, there is an increase in the demand for the good. the new demand equation is qd=190-2p. The government is trying to decide between two options: * Maintain the number of quotas and let the market adjust, or * Maintain the price support and increase the number of quotas (i). Which of the two options would be preferred by the producers? (ii) Which of the two options would be preferred by society on a whole?

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter9: Monopoly

Section: Chapter Questions

Problem 1QFR

See similar textbooks

Similar questions

A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per unit and production quotas. (NOTE: A production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota). Due to good weather, there is an increase in the demand for the good. The new demand equation is Qd = 190 – 2P. The government is trying to decide between two options: • Maintain the number of quotas and let the market adjust, or • Maintain the price support and increase the number of quotas. Suppose now that the government decides to increase the number of quotas available to 72 units, but it keeps the price support at the current level of $72.
A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per unit and production quotas. (NOTE: A production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota). Due to good weather, there is an increase in the demand for the good. The new demand equation is Qd = 190 – 2P. The government is trying to decide between two options: • Maintain the number of quotas and let the market adjust, or • Maintain the price support and increase the number of quotas
A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per unit and production quotas. (NOTE: A production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota). Due to good weather, there is an increase in the demand for the good. The new demand equation is Qd = 190 – 2P. The government is trying to decide between two options: • Maintain the number of quotas and let the market adjust, or • Maintain the price support and increase the number of quotas a. Calculate producer surplus b. Deadweight loss
A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per unit and production quotas. (NOTE: A production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota). Due to good weather, there is an increase in the demand for the good. The new demand equation is Qd = 190 – 2P. The government is trying to decide between two options: • Maintain the number of quotas and let the market adjust, or • Maintain the price support and increase the number of quotas. Suppose that the government decides to maintain the number of quotas and let the market adjust. calculate the a. The Consumer surplus b. producer surplus
A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per unit and production quotas. (NOTE: A production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota). Due to good weather, there is an increase in the demand for the good. The new demand equation is Qd = 190 – 2P. The government is trying to decide between two options: • Maintain the number of quotas and let the market adjust, or • Maintain the price support and increase the number of quotas. Suppose that the government decides to maintain the number of quotas and let the market adjust. calculate the a. price observed in the market b.producer surplus c. Deadweight loss
A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = –15 + P. The market is government-regulated with a price support per unit and production quotas. (a) If the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? (b) Calculate the deadweight loss Due to good weather, there is an increase in the demand for the good. The new demand equation is Qd = 190 – 2P. The government is trying to decide between two options: Maintain the number of quotas and let the market adjust, or Maintain the price support and increase the number of quotas. Suppose that the government decides to maintain the number of quotas and let the market adjust. (c) Calculate the(i) price observed in the market, (ii)the consumer and producer surplus (iii)deadweight loss
A market has a demand function given by the equation Qd = 180-2p, and a supply function given by the equation Qs =-15+p. The market is government-regulated with a price support per unit and production quotas.(NOTE: a production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota) a). if the price is st at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? considering the price support and the quota, calculate i) the consumer surplus ii). the producer surplus iii). the deadweight loss
A market has a demand function given by the equation Qd = 180-2p, and a supply function given by the equation Qs =-15+p. The market is government-regulated with a price support per unit and production quotas.(NOTE: a production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to produce more than the quota) Suppose now that the government decides to increase the number of quotas available to 72 units, but it keeps the price support at the current level of $72. d). calculate i). the consumer surplus ii). the producer surplus iii). deadweight loss
A market has a demand function given by the equation Qd=180-2P, and a supply function given by the equation Qs=-15+P. The market is government regulated with price support per unit and production quotas. (a) if the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? Considering the price support and the quota, calculate (I)the consumer surplus (iI)the producer surplus (iii) the deadweight loss Due to good weather there is an increase in the demand for the good. The new demand equation is Qd=190-2P. The government is trying to device between these two options maintain the number of quotas and let the market adjust or maintain the price support and increase the number of quotas? Suppose that the government decides to maintain the number of quotas and let the market adjust. Calculate (I) price observed in the market (ii)the consumer surplus (iii) the producer surplus (iv) the deadweight loss Suppose now that the government…
A market has a demand function given by the equation Qd=180-2P and and a supply function given by the equation Qs=-15+P. The market is government regulated with a price support per unit and production quotas. (a)If the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? (b) considering the price support and the quota, calculate the consumer surplus
A market has a demand function given by the equation Qd=180-2P, and a supply function given by the equation Qs=-15+P. The market is government regulated with price support per unit and production quotas. Due to good weather there is an increase in the demand for the good. The new demand equation is Qd=190-2P. The government is trying to device between these two options maintain the number of quotas and let the market adjust or maintain the price support and increase the number of quotas? Suppose that the government decides to maintain the number of quotas and let the market adjust. Calculate (I) price observed in the market (ii)the consumer surplus (iii) the producer surplus
Market demand function is given by Qd = 180 - 2P, and a Market supply function is given by Qs = ‐ 15 + P. The market is government-regulated with a price support per unit and production quotas. If the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? Considering the price support and the quota, what is the: the consumer surplus? the producer surplus? the deadweight loss? . Due to good weather conditions, there is an increase in the demand for the good. The new demand equation is Qd = 190 - 2P. The government is trying to decide between two options: Maintain the number of quotas and let the market adjust, or Maintain the price support and increase the number of quotas. Suppose that the government decides to maintain the number of quotas and let the market adjust, what is: The price observed in the market? The consumer surplus? The producer surplus? The deadweight loss? b. Suppose the government decides to increase the…