Macroeconomics

Learn the toughest concepts covered in your Macroeconomics class with step-by-step video tutorials and practice problems.

Consumer and Producer Surplus; Price Ceilings and Price Floors

Quantitative Analysis of Price Ceilings and Floors: Finding Areas

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concept

Graph Intuition

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example

The Steps We've Done Before

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The New Steps

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15m
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4
Problem

The supply and demand curves for a product are as follows. What is producer surplus if a price floor of $21 is set? 

QD = 45 – 2P 

QS = -15 + P

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Problem

The supply and demand curves for a product are as follows. What is deadweight loss if a price ceiling of $2 is set? 

QD = 600 – 100P 

QS = -150 + 150P