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Now consider that the government is going to provide a subsidy of $0.60/gallon in order to stimulate this market. In other words, the government will provide funds that allow the price paid by customers to be 60 cents/gallon lower than the price earned by suppliers find out the new price earned by sellers, the price paid by customers, and the equilibrium quantity sold in the market (again with the 60 cent/gallon subsidy)

Microeconomics, Economics

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