Purdue PSY 12000 - answerstohomework3summer2012 (9 pages)

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answerstohomework3summer2012



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answerstohomework3summer2012

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Pages:
9
School:
Purdue University
Course:
Psy 12000 - Elementary Psychology
Elementary Psychology Documents

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Economics 101 Summer 2012 Answers to Homework 3 Due 6 12 12 Directions The homework will be collected in a box before the lecture Please place your name TA name and section number on top of the homework legibly Make sure you write your name as it appears on your ID so that you can receive the correct grade Late homework will not be accepted so make plans ahead of time Please show your work Good luck Please realize that you are essentially creating your brand when you submit this homework Do you want your homework to convey that you are competent careful professional Or do you want to convey the image that you are careless sloppy and less than professional For the rest of your life you will be creating your brand please think about what you are saying about yourself when you do any work for someone else 1 Suppose the market for corn in a country is described by the following demand and supply equations Demand P 100 1 2 Q Supply P 10 13 10 Q Use this information to answer the following set of questions a What is the equilibrium price and quantity in this market For your answers you may round to the nearest whole number b What is the value of total revenue for farmers in this market Suppose the government institutes a price support in this market of 80 per unit of corn c Given the price support how many units of corn will consumers buy d Given the price support how many units of corn will the government buy e Given the price support what is the cost to the government of this program if storage costs are 10 per unit of corn stored f Draw a diagram illustrating this price support program Make sure you label your diagram clearly and completely Suppose the government cancels the price support program and in its place institutes a price guarantee program where the guaranteed price for corn is 80 per unit of corn g Given the price guarantee how many units of corn will consumers buy h Given the price guarantee what is the price per unit of corn that consumers will pay What is



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