Compute the lost social welfare, Macroeconomics

Assignment Help:

Consider a market where supply and demand are given by QXS = -18 + PX and QXd = 90 - 2PX. Suppose the government imposes a price floor of $41, and agrees to purchase any and all units consumers do not buy at the floor price of $41 per unit.

a. Determine the cost to the government of buying firms' unsold units.

b. Compute the lost social welfare (deadweight loss) that stems from the $41 price floor.


Related Discussions:- Compute the lost social welfare

Gross domestic production, why is imports subtracted from the expenditure a...

why is imports subtracted from the expenditure approach

.Exam Question, If a country allows trade and, for a certain good, the dome...

If a country allows trade and, for a certain good, the domestic price without trade is lower than the world price. A) the country will be an exporter of the good. B) the country

Produce schematic-block and simplified diagram , An antenna shown in Figur...

An antenna shown in Figure is to be adjusted from its current position to a new desired position by turning a potentiometer at an angle θ i (t) . The potentiometer converts the an

How do you explain gni per capita, To determine of the wealth is earned by ...

To determine of the wealth is earned by nations by economic activates all around the globe. Gross National Income comprises the total value of goods and services formed within a

Market for a particular type of computer memory chip, 1. Consider the marke...

1. Consider the market for a particular type of computer memory chip. Would you expect the long-run (own-price) elasticity of supply to be larger or smaller than the short-run elas

Neo-classical synthesis, Neo-classical synthesis is a synthesis of classica...

Neo-classical synthesis is a synthesis of classical model and Keynesian model. In brief, it states that Keynesian model is correct in the short run whereas the classical analysis i

Estimate the mean value, Cornell University conducted a study of wage diffe...

Cornell University conducted a study of wage differentials between men and women reported that one reason that men's wages are higher is that men tend to have more years of work ex

Give example to calculate the price level, Give example to calculate the pr...

Give example to calculate the price level Imagine that we have created a particular basket of services and goods. We calculate price level at four different points in time duri

Effect which have the bond market, Firms such a Moody's and Standard & Poor...

Firms such a Moody's and Standard & Poor's study corporations that issue bonds. They publish "ratings" for the bonds- evaluation of the likelihood of default. Suppose these rating

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd