7 Note: No referencing is required for short answer questions.Using the information contained in the diagram immediately below: (i) Calculate the consumer surplus at equilibrium. (ii) Calculate the producer surplus at equilibrium. (iii) Calculate the deadweight loss if the government imposed a price floor of $60.(iv) is the imposition of the $60 price floor Pareto Optimal? Why?120100Price ($)For the real10Demand15-Supply2025

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Note: No referencing is required for short answer questions. Using the information contained in the diagram immediately below: (1) Calculate the consumer surplus at equilibrium. (i) Calculate the producer surplus at equilibrium (1) Calculate the deadweight loss if the government imposed a price floor of $60. () is the imposition of the $60 price floor Pareto Optimal? Why? 120 Price (5) 100 22. 20 0 5 10 15 -Demand Supply 20 25 4

Note: No referencing is required for short answer questions. Using the information contained in the diagram immediately below: (1) Calculate the consumer surplus at equilibrium. (i) Calculate the producer surplus at equilibrium (1) Calculate the deadweight loss if the government imposed a price floor of $60. () is the imposition of the $60 price floor Pareto Optimal? Why? 120 Price (5) 100 22. 20 0 5 10 15 -Demand Supply 20 25 4

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter4: Markets In Action

Section: Chapter Questions

Problem 15SQ

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Demand and supply equations for housing market per month are given below. Demand for housing: Qp = 2500 – 0.5 P Supply of housing: Qs = -500 + P a) Draw the demand and supply curves for housing market in one graph. b) Find the equilibrium quantity and price for housing. c) Compute the consumer and producer surplus in equilibrium. d) Suppose that the government set a rent ceiling at $1800. What are the quantities of housing supplied and demanded at this price? In this case, is there a shortage or surplus of houses? e) How does the price ceiling affect the efficiency in the housing market? f) Calculate the deadweight loss in the housing market after the price ceiling is imposed by the g) Calculate the potential spending for housing search activities. government.