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If demand for toys is QD = 500 – 10P and supply is Qs =...

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Economics

If demand for toys is QD = 500 – 10P and supply is Qs = 100 +10P, answer the following questions using calculus:

a. If the government imposes a restriction that price per toycannot exceed $15, calculate the ΔCS, ΔPS, and DWL from the priceceiling.

b. If the government imposes a restriction that price per toycannot be lower than $18, calculate the ΔCS, ΔPS, and DWL from theprice floor.

c. If the government promises toy producers a price of $25 perunit and will buy up any excess supply to support that price,calculate the ΔCS, ΔPS, and DWL from the price support.

d. If the government promises toy producers a price of $22 perunit and will pay the difference between $22 and the priceproducers receive from consumers, calculate the ΔCS, ΔPS, and DWLfrom the price support.

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