Suppose That the Market for Corn Is Initially in Equilibrium $P = 10 - Q ^ { d }$

question 82

Multiple Choice

Suppose that the market for corn is initially in equilibrium and is perfectly competitive. The demand curve can be expressed as $P = 10 - Q ^ { d }$ ; the supply curve can be expressed as $P =$ $0.25 Q ^ { s }$ . Quantity is expressed in millions of bushels. Now suppose that the federal government imposes a price floor of $\$ 3$ per bushel of corn. What is the dead-weight loss (per million bushels) associated with the price floor when the most efficient producers are active?

• A) \(\$ 9.375\)
• B) \(\$ 2.25\)
• C) \(\$ 1\)
• D) \(\$ 0.63\)

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