Econ HW - If the price is $6, the quantity supplied is 3...

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Econ 110 HW 2 Ch 6 2. a. see attached b. Yes, it is possible that the price floor has reduced the farmers’ total revenue. Because of the price increase, less people are going to was to pay the higher price. Therefore the farmers will have sold less and receive less revenue. c. The farmers benefit because they receive much more revenue because they are selling all their cheese at the higher price. The buyers lose because they are still forced to buy the cheese at the higher price. 3. a. equilibrium price = $8; equilibrium quantity = 6 million b. Market price = $10; 2 million Frisbees are sold c. Market price = $8; 6 million Frisbees are sold Ch 7 2. The change in the demand causes an increase in producer surplus in the market for French bread. The demand for flour also rises, increasing the producer surplus for flour. 5. a. If the price is $2, the quantity supplied is 1 and the quantity demanded is 3. If the price is $4, the quantity supplied is 2 and the quantity demanded is 2.
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Unformatted text preview: If the price is $6, the quantity supplied is 3 and the quantity demanded is 1. When the price is at $4, quantity supplied and quantity demanded is in equilibrium, they both are 2. b. Consumer Surplus = $4 Producer surplus = $4 Total surplus = $8 c. Total surplus will decrease to $6 d. The total surplus would increase to $10. Ch 8 1. a. see attached page 4. a. The consumers would take most of the burden of the tax. Consumer surplus will decrease much more than producer surplus decreases. b. The producers would take most of the burden. Consumer surplus will not decreases as much as producer surplus decreases. Ch 10 2. a. No. The deadweight loss would be reduced, not increased. b. No. The tax will affect both buyers and sellers no matter what. 3. a. The buyer could save someone or someone elses things from fire. b. see attached c. see attached d....
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Econ HW - If the price is $6, the quantity supplied is 3...

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