Explore BrainMass
Share

Explore BrainMass

    consumer surplus and producer surplus

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Show the consumer surplus. Show the producer surplus.

    Suppose that a price ceiling of $12 was imposed. How would this change the consumer and producer surplus? Suppose a price floor of $16 was imposed. How would this change the consumer and producer surplus?

    © BrainMass Inc. brainmass.com October 10, 2019, 1:00 am ad1c9bdddf
    https://brainmass.com/economics/perfect-competition/consumer-surplus-producer-surplus-317212

    Attachments

    Solution Preview

    For diagrams, look at the attached files.

    Initially, equilibrium price = $14 and quantity = 15 units.

    CS = 1/2 x 6 x 15 =45

    PS = 1/2 x 6 x 15 =45

    [to find point D in ss curve,look ...

    Solution Summary

    The consumer and producer surpluses are presented. How the change in the consumer and producer surplus are determined is given.

    $2.19