HW chap 15-3

00billionandthenewlevelofproducersurplusis2560billiont

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Unformatted text preview: billion bushels. With a price ceiling of $4.00, we compute that: QS = (5)(4.00) ­4 = 16.0 Qd = 28 ­ (2)(4.00) = 20.0 The quantity that will actually be sold in the market is the quantity supplied. The new level of consumer surplus is $96.00 billion, and the new level of producer surplus is $25.60 billion. The new level of aggregate surplus is $121.60 billion Thus, the deadweight loss is $2.86 billion. The price ceiling in...
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