How is supply reduction required set up and computed?, how is the cost of the senators program set up and calculated?

3. Senator Cityslicker doesn't like the Secretary's government surplus purchase program proposal or Congressman Drinksalot's marketing loan program because she says both result in too much rice production and cost too much. She proposes a mandatory acreage reduction program to push the price of rice up to $14.00/cwt. Secretary Perdue asks you to calculate the total reduction in rice supply that would be required to push price to $14.00/cwt under Senator Cityslicker's plan. Supply reduction required = Cost of the Senator's program? = 2 point BONUS: Calculate the acreage reduction that would be required if there is 5% slippage. Supply reduction required with 5% slippage =I. Costs of Policy Proposals (50%) In working these problems, assume that you are a policy analyst working for the Secretary of Agriculture. The information you need to answer the questions is given in the table below. Note that quantities are given in million hundredweight (cwt) and prices are given in S/cwt. You may not need all the information given in the table for every question. You must show your work on one or more separate sheets and staple them to the problem set. Equilibrium price Before Rice Quantities and Prices elasticities Programs Supply (million cwt) 0.75 189.886 Demand (million cwt) -0.4 189.886 Farm Price (S/cwt) 10.00 Consumer price (S/cwt) 10.00 Target Price (S/cwt) None Support Price (S/cwt) None Government Cost (mil $) None NOTE: -- = Not applicable