Suppose the demand and supply curve for wheat in the us are, Ask an Expert

Economics

Suppose the demand and supply curve for wheat in the U.S. are approximately as follows:

Q_D = 4000 - 200P

Q_S = 2800 + 200P

1) How much wheat did the government need to buy to support the price of $3.50 per bushel? What was the effect of government purchase on the demand curve? Show this in the graph.

2) What was consumer’s gain or loss? Producer’s gain or loss? Government purchase cost? Change in total social surplus?

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91950487

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