Show and explain how the distribution/allocation constraints are satisfied by any point in an Edgeworth-box diagram.

Critique the following statement as True or False and explain your reasoning in 2-3 sentences. "Market failures are observed when government intervention prevents market forces from guiding marketstoward an equilibrium."

In competitive markets, we know that: P= MWTP P= MC MC= AC P= Min AC Which result(s) implies that the outcome is socially optimal?

B. Let’s consider the market for flour in a different town. Assume that it is efficient (i.e. that there are not external costs to producing flour, and no external benefits from consuming it). Price ($/lb) Quantity Supplied (thousands of lbs per day) Quantity Demanded (thousands of lbs per day) 1.5 8 14 2 9 13 2.5 10 12 3 11 11 3.5 12 10 4 13 9 What is the price and quantity of flour sold without government intervention. Graph this equilibrium. XXXX   2. Suppose that, alarmed by the inability of many poorer consumers to buy flour, the government institutes a $2/lb price ceiling. How much flour will suppliers wish to sell, and how much will buyers demand?  How much flour will actually be sold? Show this outcome on the same graph you drew for question 1. XXXX 3. Describe, in one sentence each, three problems that this policy might create? Please do not simply copy down phrases from the textbook, but instead describe ways that…