Microeconomics 6th Edition by Robert Hall, Shirley Kuiper, Marc Lieberman

Exercise 1

Suppose the weekly quantity demanded ( Q D )for a good is given by the equation Q D = 10,000 - 80 P ,and the weekly quantity supplied ( Q S )is given by Q S = 20 P ,where P is the price per unit.
a. What is the equilibrium price and quantity?
b. When the market is in equilibrium,what are the values of consumer surplus,producer surplus,and total benefits? [Hint: Sketch a rough graph first.]
c. Find the value of the deadweight loss (dollars per week)if a price ceiling of $80 is imposed on this market.
d. Find the value of the deadweight loss (dollars per week)if a price floor of $110 is imposed on this market.