Exhibit 7-12 
-Refer to Exhibit 7-12. Calculate the deadweight loss of a government program that establishes a minimum price of $7 per unit and requires that the government buy the resulting surplus.
Definitions:
Nash Equilibrium
A concept within game theory where no participant can gain by changing strategies if the strategies of the others remain unchanged.
AMD
Advanced Micro Devices, Inc., an American multinational semiconductor company that develops computer processors and related technologies.
Intel
A multinational corporation and technology company known primarily for its semiconductor chips used in computer systems.
Time-Discounted Profits
The present value of future profits, taking into account the time value of money and the preference for receiving profits earlier rather than later.
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