The Ministry of Misallocation has decreed that the production of widgets must be 2000 each month and the producti- gizmos must be 14000 each month. Calculate the deadweight loss in each market caused by these restrictions. Please he scale of the quantity axis is in thousands. Price of widgets Price of gizmos $10 $100 90 8. Supply Supply 80 70 6. 60 5 50 4 40 3 30 Demand Demand 20 1 10 1 2 3 4 5 6. 7 8 9 10 2 4 6 8 10 12 14 16 18 20 Quantity of widgets (in thousands) Quantity of gizmos (in thousands) What is the deadweight loss in the widgets market? $ What is the deadweight loss in the gizmos market?

The Ministry of Misallocation has decreed that the production of widgets must be 2000 each month and the producti- gizmos must be 14000 each month. Calculate the deadweight loss in each market caused by these restrictions. Please he scale of the quantity axis is in thousands. Price of widgets Price of gizmos $10 $100 90 8. Supply Supply 80 70 6. 60 5 50 4 40 3 30 Demand Demand 20 1 10 1 2 3 4 5 6. 7 8 9 10 2 4 6 8 10 12 14 16 18 20 Quantity of widgets (in thousands) Quantity of gizmos (in thousands) What is the deadweight loss in the widgets market? $ What is the deadweight loss in the gizmos market?

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter7: Market Efficiency And Welfare

Section: Chapter Questions

Problem 5P

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