***

Correct answers will receive 1 mark.  Incorrect answers will

receive -0.75 mark.  An answer left blank will receive 0 marks.  So decide

carefully before you answer.***

The market for rice currently is at the equilibrium.  Demand for rice is P = 39 - 0.0015Q and supply is P = 3.8 + 0.001Q.  Then the government imposes a price ceiling at $11.

By how much will total surplus change? 

If it is a negative change (a decrease) be sure to enter the negative sign.  E.g. -$50

A market is characterized by the following functions:

Demand: P = 280 - 0.34Q

Supply: P = 40 + 0.06Q

Suppose the government imposes a price floor at $212.

Calculate the producer surplus.

A market for apartments is characterized by the following functions:

Demand: P = 2720 - 0.1Q

Supply: P = 433 + 0.4Q

Suppose the government imposes a price ceiling at $1285.

Calculate the loss of surplus for the renters who are no longer able to find an apartment to rent.

Do not enter the negative sign.

***

Correct answers will receive 1 mark.  Incorrect answers will

receive -0.75 mark.  An answer left blank will receive 0 marks.  So decide

carefully before you answer.***

Consumers will be better off if the tax is imposed in the market (S^T) rather than the quota (Q₁).

A market is characterized by the following functions:

Demand: P = 180 - 0.14Q

Supply: P = 20 + 0.06Q

Suppose the government imposes a quota at 400.

Calculate the deadweight loss.

A market contains the following demand and supply functions:

Demand: P = 79 - 0.025Q

Supply: P = 3 + 0.01Q

Calculate the surplus (number of units) if the price is set at $71.

***Remember if the answer is not a whole number to leave two numbers after the decimal point.***