Question 6 A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per...

Extracted text: Question 6 A market has a demand function given by the equation Qd = 180 – 2P, and a supply function given by the equation Qs = -15 + P. The market is government-regulated with a price support per unit and production quotas. (NOTE: A production quota is a restriction on the quantity of the good that can be produced. Firms are not allowed to %3D %D produce more than the quota) (a) If the price is set at $72 per unit, what production quota is needed to make sure there are no shortages or surpluses? HINT: Sketch the supply and demand equations. Answer:


Extracted text: Considering the price support and the quota, calculate (i) the consumer surplus, Answer: