Question: 1) The demand and supply functions for basic cable TV in the local market are given as: QD = 200,000 - 4,000P and QS =

1) The demand and supply functions for basic cable TV in the local market are given as:

QD = 200,000 - 4,000P and QS = 20,000 + 2,000P. Calculate the consumer and producer surplus in this

market. If the government implements a price ceiling of $15 on the price of basic cable service, calculate

the new levels of consumer and producer surplus. Are all consumers better off? Are producers better off?

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