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Consider a market where supply and demand are given by QXS = -16 + PX and QXd = 83 - 2PX. Suppose the government imposes a price floor of $40, and agrees to purchase any and all units consumers do not buy at the floor price of $40 per unit. Assume that the government simply removes product from the market through its purchase
a. Determine the cost to the government of buying firms’ unsold units. $
b. Compute the lost social welfare (deadweight loss) that stems from the $40 price floor.
When the stock of money increases too rapidly, then the economy will likely experience. The money supply in the united states is backed by. Money that is backed by something tangible like gold
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