Suppose that the aggregate supply function for a good is sp, Ask an Expert

Economics

Suppose that the aggregate supply function for a good is S(P) = 10 + P and the aggregate demand function is D(P) = 40 − P. Suppose that the market for the good is perfectly competitive.

i) Solve for the equilibrium price and quantity.

ii) Now, suppose that the government tries to restrict the industry to selling only 20 units. At what pricewould 20 units be demanded (P^D) ? At what price would 20 units be sold (P^S)?

iii) What is the total deadweight loss from restricting the supply to 20 units? (Hint: It might help to thinkthrough the problem graphically).

View complete question

Business Economics, Economics

Category:- Business Economics
Reference No.:- M91950533

Have any Question?Write your Review or question?

Related Questions in Business Economics

The mean length of 12 newly hatched iguanas is 700 inches

The mean length of 12 newly hatched iguanas is 7.00 inches with a standard deviation of 0.75 inches. Construct and interpret a 90 % confidence interval for the mean length of all newly hatched iguanas. Assume that the le ...

Sixty percent of adults have looked at their credit score

Sixty percent of adults have looked at their credit score in the past six months. If you select 31 customers, what is the probability that at least 25 of them have looked at their score in the past six months?

You work for a firm that manufactures dvd players your dvd

You work for a firm that manufactures DVD players. Your DVD players last an average of 800 days with a standard deviation of 200 days. You want to set the warranty length such that you only have to replace 1.5% of all th ...

In this question you need a z table and then you can get

In this question you need a Z table and then you can get all answers? You have a normal distribution with a mean of 90 and a standard deviation of 7. If appropriate, calculate the following probabilities: What is: Probab ...

In an experiment with equiprobable outcomes the sample

In an experiment with equiprobable outcomes, the sample space is S = {1,2,3,4} with P(s) = 1/4. A1 = {1,3,4}, A2 = {2,3,4}, A3 = ∅(null set). Are the events independent? Show all works.

How does the percent below poverty level compare to the

How does the "percent below poverty level" compare to the national rate? What factors are causing your county poverty rate to differ from (or equal) the national poverty rate?

Identify how protecting sovereign boundaries in regards to

Identify how protecting sovereign boundaries in regards to intellectual property has a positive effect on the GDP. Your answer should be in complete sentences

Suppose after collecting data on an existing firms actual

Suppose, after collecting data on an existing firm's actual short-run ouput, the following production function is found to match the data: TP = Q = 5*L + 0.6*L2 - 0.01*L3 1. Using the equation above, find the following ...

A jewerly store paid a unit price of 250 less 40 16 8 for

A jewerly store paid a unit price of $250 less 40%, 16% , 8% for a shipment of designer watches. the store's overhead expenses are 65% of cost and the required profit is 55% of coat. a. What is the regular selling price ...

Each of the following lists has an average of 50 for which

Each of the following lists has an average of 50. For which one is the spread of the numbers around the average biggest?smallest? a. 0, 20, 40, 50, 60, 80, 100 b. 0, 48, 49, 50, 51, 52, 100 c. 0, 1, 2, 50, 98, 99, 100 Gu ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Business Economics Expert