When will the deadweight loss be created? When a binding price constraint is implemented When the market is clearing When consumer and producer surplus are maximized When surplus is shifted from consumer to producer
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When will the
When a binding price constraint is implemented
When the market is clearing
When
When surplus is shifted from consumer to producer
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- 1)Refer to the figure above. If a price control is imposed at $8, what is the gain in consumer surplus? 2) Refer to the figure above. If a price control is imposed at $8, what is the loss in producer surplus?When a market is competitive and functioning properly, economic theory predicts that the market equilibrium will be efficient. However, this may not always be the desired outcome. Market outcomes may be unequal or distorted by market failure. What effect will this solution have on consumer surplus, producer surplus, social surplus, and deadweight loss? Explain.What is the producer surplus? What is the worker surplus? Show that a competitive market equilibrium maximizes the gains from trade.
- Consider a free market with demand equal to Q = 800 − 10P and supply equal to Q = 10P. What is the value of consumer surplus? What is the value of producer surplus?Assume the market for headbands is characterized by a downward sloping demand curve and an upward sloping supply curve. Suppose there is an improvement in technology for producing headbands. Which of the following would occur? A C E The total surplus (sum of producer and consumer surplus) would increase B The change in equilibrium price would cause total producer surplus to increase D The impact on total consumer surplus would be indeterminate, because of the offsetting impact of the changes in equilibrium price and quantity The supply curve would shift up, resulting in an increase in the equilibrium quantity and total producer surplus The demand curve would shift right in response to an increase in equilibrium price https://bcps.schoology.com/common-assessment-print/course/6305214264/6083116066?multipleQuestions=1&includeAnswerkey=1&includeBlank 10/33Suppose anyone with a driver's license is capable of supplying one trip from the airport to the downtown business center on any given day. The long-run supply curve of such trips is horizontal at p = $50, which is the average cost of such trips. Suppose daily demand is Q = 1000 - 10p. Calculate the change in consumer surplus, producer surplus and social welfare if the city government restricts the number of trips to be 300 at maximum by issuing special licenses
- A firm that electroplates inexpensive jewelry produces toxic waste, some of which ends up in a nearby river because of pipe leakage. If state regulators notice the problem and order the firm to make repairs and improve its monitoring processes, the supply curve will shift from S1 to S2.What region of the graph represents the deadweight loss that is eliminated by the change? Use the area tool to outline the region.What would be the producer surplus and the deadweight loss?The market for N-95 masks is perfectly competitive. Market Demand is given by Q=434-2P and Market Supply is given by Q=2P. The government imposes a price ceiling of $52. What is the maximum Consumer Surplus in the market with the price ceiling?
- With a fully labeled supply-demand graph, draw the effects of a binding price FLOOR (minimum price) in the market for milk. Using letters to label areas of your graph, clearly indicate (i) old and new consumer surplus (ii) old and new producer surplus (iii) any deadweight loss and (iv) any transfers.Suppose the market for a certain good is perfectly competitive and the demand is given by P=1000-Q and the supply is given by P=Q. The market is currently in equilibrium. What are the producer surplus and consumer surplus, respectively? $1250 and $1250 $2500 and $2500 $2500 and $1250 $1250 and $2500Assume the market depicted in the graph is in equilibrium. What is producer surplus? $30 $60 $50 $20