76 977
Assignments Done
Successfully Done
In June 2019

Answer to Question #42471 in Microeconomics for asad

Question #42471
The US Farm Bill 2012 indicates that the domestic price of wheat will be maintained at $350 per tonne, which is above the market equilibrium level of $300 per tonne, in order to support for domestic wheat growers. At the market equilibrium, 100 tonnes are supplied.
(a) Is the wheat price control in the US a price floor or a price ceiling? (1 mark)
(b) On a graph, show and explain if the price control in the US creates a shortage or a surplus in the market for wheat. Assume that the US does not trade wheat internationally. (2 marks)
(c) Show on a graph and explain how the price control in the US changes consumer surplus, producer surplus, and deadweight loss in the domestic wheat market.
Expert's answer

Need a fast expert's response?

Submit order

and get a quick answer at the best price

for any assignment or question with DETAILED EXPLANATIONS!


No comments. Be first!

Leave a comment

Ask Your question

Privacy policy Terms and Conditions