QUESTION

# Consider a market where supply and demand are giv

Consider a market where supply and demand are given by QXS = -16 + PX and QXd = 92 - 2PX. Suppose the government imposes a price floor of $40, and agrees to purchase any and all units consumers do not buy at the floor price of$40 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 $40 price floor. • @ • 312 orders completed ANSWER Tutor has posted answer for$10.00. See answer's preview

$10.00 ******* ****** and demand ***** Click here to download attached files: Student- supply and demand.docx or • @ • 358 orders completed ANSWER Tutor has posted answer for$10.00. See answer's preview

\$10.00

**** ** the right ******