1. Suppose we have the following demand and supply equations: D(p)-200-p S(p) 150+p A. What is the equilibrium price and quantity? B. The government decides to restrict the industry to selling only 160 units by imposing a maximum price and rationing the good. What maximum price should the government impose? C. The government doesn't want the firms in the industry to receive more than the minimum price that it would take to have them supply 160 units of the good. Therefore, they issue 160 ration coupons. If the ration coupons were freely bought and sold on the open market, what would be the equilibrium price of these coupons? D. Calculate the dead-weight loss from restricting the supply of the goods. Will the dead-weight loss

1. Suppose we have the following demand and supply equations: D(p)-200-p S(p) 150+p A. What is the equilibrium price and quantity? B. The government decides to restrict the industry to selling only 160 units by imposing a maximum price and rationing the good. What maximum price should the government impose? C. The government doesn't want the firms in the industry to receive more than the minimum price that it would take to have them supply 160 units of the good. Therefore, they issue 160 ration coupons. If the ration coupons were freely bought and sold on the open market, what would be the equilibrium price of these coupons? D. Calculate the dead-weight loss from restricting the supply of the goods. Will the dead-weight loss

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter6: Elasticity

Section: Chapter Questions

Problem 11QP: Suppose you learned that the price elasticity of demand for wheat is 0.7 between the current price...

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