For example, consider a pumpkin market where the supply is dependent on weather condition for the entire year....

Supply is P = 6Qs + 2 in bad weather years.

P = 6Qs - 58 in good-weather years

Quantity demanded (Qd) for pumpkins equals Qd - 1/2P.

Think about a scenario in which the government institutes a price-support program to stabilize pumpkin prices at $32. Farmers are promised that the government will buy or sell anything that consumers want or producers want to sell for $32. The government has enough storage to buy all the food that farmers grow and to supply all the food that consumers want, right? Assume

The cost of storing a pumpkin is $1.

Calculate the number of pumpkins at:

Bad weather year

Good weather year.

Calculate the consumption of the in:

Good weather year

Bad weather year

If the government were to start subsidizing pumpkins instead of a price support program,

The Govt expenses at the bad weather add up to $128 to subsidize the pumpkins farmer. Calculate the per unit subsidy? Calculate the target price.