Suppose that the inverse demand and supply fuctions for ethanol are: P = 22-2Qd, P = 2+2Qs, where P is the price of ethanol in USD/gallon and Q is quantity of ethanol in million gallons. The government imposes a subsidy equal to s = 4 USD/gallon.

Suppose that the inverse demand and supply fuctions for ethanol are: P = 22-2Qd, P = 2+2Qs, where P is the price of ethanol in USD/gallon and Q is quantity of ethanol in million gallons. The government imposes a subsidy equal to s = 4 USD/gallon.

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter4: Supply And Demand: An Initial Look

Section: Chapter Questions

Problem 8TY

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