The domestic demand and supply for sugar are Q^d = 60,000 − 400P and Q^SD = 20,000 + 500P.The foreign supply is Q^SF = 20,000 + 100P.How many units of sugar will domestic producers supply after the quota is imposed?

Question

Quizplus · Accepted Answer

The quota will raise the domestic price of sugar to the world price, which is determined by the intersection of the foreign supply and domestic demand curves. At this price, domestic producers will supply 35,000 units of sugar.

The Domestic Demand and Supply for Sugar Are Qd =

The Domestic Demand and Supply for Sugar Are Q^d =