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Unformatted text preview: MC = 0 . 5 Q. What government price ceiling would represent optimal price regulation? 1 (3) The above ﬁgure shows supply and demand curves for milk. In an ef-fort to help farmers, the government passes a law that establishes a $3 per gallon price support. To maintain the price support, government expenditures must equal (A) k + i (B) f + g + h + i + j (C) f + g + h + i + j + k (D) f + g + h + i + j + k + e (4) Suppose that market demand for a good is Q = 480-2 p . The marginal cost is MC = 2 Q . Calculate the deadweight loss resulting from a monopoly in this market. 2...
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- Spring '07
- Supply And Demand, TA, run supply curve, marginal cost curve, inverse demand curve, Romita Mukherjee