Question: Question. Consider the inverse demand function P=20-Q and the inverse supply function P=2+Q. Find (a) equilibrium price P* and Q*, (b) consumers surplus (CS), producers

Question.

Consider the inverse demand function P=20-Q and the inverse supply function P=2+Q.

Consider the inverse demand function P=20-Q and the inverse supply function P=2+Q. Find (a) equilibrium price P* and Q*, (b) consumers surplus (CS), producers surplus (PS) and the total surplus (TS). Price ceiling: (i) Find the quantity demanded and quantity supplied when government imposes a price ceiling of $14 per unit. (ii) Find the quantity demanded and quantity supplied when government imposes a price ceiling of $10 per unit. Price floor: (1) Find the quantity demanded and quantity supplied when government imposes a price floor of $12 per unit. (2) Find the quantity demanded and quantity supplied when government imposes a price floor of $8 per unit.

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