The current competitive market equilibrium price of an agricultural commodity is $3.50. Three-hundred (300) units of the commodity are sold at this price. The government has determined that price target of $4.00 would help to stabilize prices and ensure the long-run viability of the industry. At $4.00 producers would supply 400 units of the commodity. With 400 units supplied the government would need to provide a price support of $1.67 per unit.
A. Provide a graph of the market conditions including both the current market equilibrium conditions and the conditions with the price floor and associated price support.
B. What is the value of the change in consumer surplus associated with the new policy?
C. What is the value of the change in producer surplus associated with the new policy?
D. What is the net cost (or benefit) associated with the new policy? (Indicate whether it is a cost or a benefit.

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LMN Ltd. invited application for issue of 100, 000 shares of Rs.10 each at premium of Rs.2, Rs.5 called at the time of applications, Rs.5 (including premium) at the time of allotment and balance Rs.2 at the time of 1st call. Application were received for 1,30,000 shares. Application money was returned to the extent to 10,000 shares and pro rata allotment was made to the remaining applicants of 120, 000. PQR to whom 500 shares were allotted failed to pay allotment and calls money. Similarly ABC to whom 400 shares were allotted failed to pay first and final call. All the 900 shares were subsequently forfeited. These shares were subsequently re-issued at Rs.8 fully paid. Based on the above facts, the minimum rate at which 400 forfeited shares of ABC can be re-issued is LMN Ltd. invited application for issue of 100, 000 shares of Rs.10 each at premium of Rs.2, Rs.5 called at the time of applications, Rs.5 (including premium) at the time of allotment and balance Rs.2 at the time of 1st call. Application were received for 1,30,000 shares. Application money was returned to the extent to 10,000 shares and pro rata allotment was made to the remaining applicants of 120, 000. PQR to whom 500 shares were allotted failed to pay allotment and calls money. Similarly ABC to whom 400 shares were allotted failed to pay first and final call. All the 900 shares were subsequently forfeited. These shares were subsequently re-issued at Rs.8 fully paid. Based on the above facts, the minimum rate at which 400 forfeited shares of ABC can be re-issued is

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