Suppose market demand and supply are given by Q^d = 100 − 2P and Q^s = 5 + 3P.If a price floor of $30 is set,what will be size of the resulting surplus?

Question

Quizplus · Accepted Answer

To find the surplus, we need to find the difference between the quantity supplied and quantity demanded at the price floor of $30. 
At $30, 
Quantity demanded: 100 - 2(30) = 40 
Quantity supplied: 5 + 3(30) = 95 
Surplus = Quantity supplied - Quantity demanded = 95 - 40 = 55. 
Therefore, the size of the resulting surplus is 55. Choice D is the correct answer.

Suppose Market Demand and Supply Are Given by Qd =

Suppose Market Demand and Supply Are Given by Q^d =