Chapter Problem 8 Question Help * The table shows the demand and supply schedule

Question

Chapter Problem 8 Question Help * The table shows the demand and supply schedules for strawberries Suppose that the government introduces a production quota for strawberries and Quantity Quntity detnanded supplied Price sets it at 1,000 pounds per week Who gains and who loses? What are the market price of strawbemes, the producer sumplus, and the deadweight loss? The market price of strawberries is $ 5.00a pound The producer surphie is 1.25 250 3.75 5 00 6.25 7.50 2.250 2.000 1,750 1500 1,250 1,000 500 ,000 1500 2,000 2,500 x Answer to two decimal places Enter your answer in the arewer box and then cack Check Ansæer Clear A

Explanation / Answer

new price will be $3.75 at quota of1000. so new producer surplus= 1/2*(3.75-1.25)*(1000)=1250

initial producer surplus was= 1/2*(5-1.25)*(1500)=2812.5

consumer gains while prodocer losses by 1562.5 amount which is difference of intial and new producer surplus.

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.