Demand for apartments in a certain town is D(x) = 820-4x, and the supply is S(x)=400+...

 

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Demand for apartments in a certain town is D(x) = 820-4x, and the supply is S(x)=400+ 11x, where x is the number of apartments, in hundreds, and D(x) and S(x) are the rent in dollars per month, per apartment. a) Find the equilibrium point. b) Find the consumer surplus and producer surplus. c) Suppose a maximum rent of $532 per month is imposed by the town council. Find the point (xc. Pc). d) Find the new consumer surplus and new producer surplus. e) Find the deadweight loss. Demand for apartments in a certain town is D(x) = 820-4x, and the supply is S(x)=400+ 11x, where x is the number of apartments, in hundreds, and D(x) and S(x) are the rent in dollars per month, per apartment. a) Find the equilibrium point. b) Find the consumer surplus and producer surplus. c) Suppose a maximum rent of $532 per month is imposed by the town council. Find the point (xc. Pc). d) Find the new consumer surplus and new producer surplus. e) Find the deadweight loss.

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SOLUTION a To find the equilibrium point we need to set the demand equal to the supply Dx Sx 820 4x 400 11x 15x 420 x 28 Therefore the equilibrium poi... View the full answer