Consider a price maker and the market for good x: D(q)=81-8q MC(q)=14q+21 MR(q)=81-16q C(q)=7q2+21q+10 a) What is the point of equilibrium for the market for good x? b) For the price maker, how many units of good x must the firm manufacture to maximize profits? c) What will be the price the firm will charge to consumers?

Consider the market for bicycles in the fictional province of Westvale. The market demand function for bicycles is given by P=300-2Q. The marginal cost curve for firms in this market is given by P=40+Q. Prices are measured in dollars.    a) Under a competitive market equilibrium, what is the price of a bicycle?  b) How many bicycles are produced under a competitive market equilibrium?  c) Calculate consumer surplus, producer surplus, and total surplus under the competitive market equilibrium    Suppose that the firms that were once competing in this market merge into one single firm, forming a monopoly. This monopoly has a marginal revenue function of P=300-4Q. d) What price does this monopolist charge?  e) How many bicycles does the monopolist produce?  f) Calculate consumer surplus, producer surplus, and total surplus under the monopolistic market outcome  g) How much deadweight loss resulted from the creation of the monopolist?

Assume the market for peanut butter is competitive with normally sloped supply and demand curves and the market is currently in equilibrium.   If there is a decrease in supply resulting in a new market equilibrium, will the amount of consumer surplus increase, decrease, or remain unchanged relative to the amount of consumer surplus found at the initial market equilibrium?

Suppose the market for pizzas in the U.S. is perfectly competitive and is characterized by the following demand and supply equations (Q = quantity and P = Price): Demand for pizza: Qd = 100 – P Supply of pizza: Qs = 2P − 50 A) Find the market clearing equilibrium price P* and quantity Q*. B) Find the the consumer surplus and producer surplus at the equilibrium. C) Suppose that the U.S. imposes a price ceiling at $40. What is the quantity demanded by consumer (Qd’)? What is the quantity supplied by suppliers (Qs’)? D) Suppose that the U.S. imposes a price ceiling of $40. Is there a shortage or surplus for pizzas? E) Suppose that the U.S. imposes a price ceiling of $40. What is the new CS’ and PS’? Assuming that the government purchases/provides the surplus/shortage. Under the same assumption, what is the deadweight loss caused by the price floor?