Please type solutions & diagrams where possible.

Question 1 (40 marks) (a) 24 marks Consider the following demand and supply equations: Q = 60,000 - 2P Q: -6,000+P 1) 9 marks Find the equilibrium price and quantity in the market using the equations above. Show your calculations. (1) 9 marks Plot the demand and supply curves and illustrate the equilibrium price and quantity Your diagram should be drawn to a proper scale and should include the intercepts on the demand and supply curves. (1) 6 marks Suppose the government sets the price at 19,000 per unit. Is this an example of a price ceiling or a price floor? Explain. Illustrate and explain the impact of this measure on the market. Use the diagram you drew in part (1) (b) 16 marks Using four separate demand and supply diagrams Illustrate and explain how each of the following events affects the market for new houses. What happens to equilibrium price and quantity in each case? consumer Income decreases (H) the price of development and falls (H) consumers expect interest rates to fall significantly over the next two years (iv) the population falls by 10 percent due to emigration and the price of development land fails