The demand curve for wheat is Q=140−10p Supply curve is Q=10p. Equilibrium quantity is 70. Equilibrium price is $7. The government imposes a price ceiling of p=$3 per unit. Equilibrium quantity with the price ceiling is 30. What effect does this ceiling have on consumer surplus, producer surplus, and deadweight loss?
The demand curve for wheat is Q=140−10p Supply curve is Q=10p. Equilibrium quantity is 70. Equilibrium price is $7. The government imposes a price ceiling of p=$3 per unit. Equilibrium quantity with the price ceiling is 30. What effect does this ceiling have on consumer surplus, producer surplus, and deadweight loss?
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter4: Markets In Action
Section: Chapter Questions
Problem 3SQ
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The demand curve for wheat is Q=140−10p
Supply curve is Q=10p.
The government imposes a price ceiling of p=$3 per unit.
Equilibrium quantity with the price ceiling is 30.
What effect does this ceiling have on consumer surplus, producer surplus, and deadweight loss?
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