Consider the market for paper towels where the supply curve is upward sloping and the demand curve is downward sloping. a. Suppose there is an effective price ceiling applied on this market. What happens to the consumer surplus as a result?   b. Suppose there is an effective price floor applied on this market. What happens to the consumer surplus as a result?

Explain it correctly.

What is consumer surplus? How is it illustrated on a demand and supply diagram? please draw

Suppose the market price of wheat is $7 a bushel and a price ceiling is set at $9 a bushel. What is the impact of this price ceiling?

If the economy goes into a recession and incomes fall, what happens in markets? Prices of inferior goods go up because the demand for them increases Prices of normal goods go up because the demand for them increases Prices of all goods go down None of the other answers is correct Suppose the demand curve is given by P=10-Q and the supply curve by Q=P If the price in the market is given by $7, then The market is in equilibrium There is a a surplus in the market There is a shortage in the market Increasing the price will result in an increase in the quantity demanded

Use the figure below to answer the following question. Price A B E LL F S St S K K Quantity D What area represents society's total surplus after the government imposes the excise tax on the market?

Use the following information to answer Questions 1 - 3 In a competitive market for whole milk, the market demand is QD = 1000 – 50P and the market supply is QS = 150P, where Q denotes the quantity in gallons and P denotes the price in dollars. [1] Calculate the competitive market equilibrium price? [2] Calculate the competitive market equilibrium quantity? [3] At the competitive market equilibrium price and quantity, calculate the value for consumer surplus? Hint: it might be helpful to construct a graph.

1. Consider the market for cell phones in Celltown. Suppose that the inverse demand curve is P = -2Qd + 300 and that the inverse supply curve is P = 3Qs + 50. a. Sketch the inverse supply and inverse demand curves. b. Calculate the equilibrium price and quantity. c. Compute consumer surplus (CS), producer surplus (PS), and total surplus. d. Suppose the Mayor of Celltown institutes a price floor of P = $250 in order to promote the new technology. It is illegal to sell cell phones at a price below P. What is the quantity transacted in the market with the price floor? e. Compute the change in CS and the change in PS. f. Compute the change in total surplus. If you were an economic advisor to the Mayor whose goal is to maximize the total surplus of the city, would you advise continuing the policy or not? Explain. g. A representative of the Association of Cell Phone Manufacturers arrives at the Mayor's office to lobby against eliminating the price floor. i. Explain why economic theory…

Let the supply and demand for coffee be given by the following schedule. Price:             3,  4,  5,  6,  7,  8,  9,  10,  11 Quantity Supplied:          100,  200,  300,  400,  500,  600,  700,  800,  900 Quantity Demanded:        900,  800,  700,  600,  500,  400,  300,  200,  100 After heavy lobbying by coffee-addicted econ instructors, the government decides to impose a price ceiling on coffee at $5.   (All answers are integers, no units. ) 1. What quantity of coffee is efficient? 2. What quantity will be traded with the price ceiling?  3. Assume that coffee is rationed by waiting in line.  If all buyers have a value of time equal to $0.20 per minute, how long will they need to wait in line to get coffee (in minutes)?  4. What is the total cost of waiting in line?