Unit 4- Assignment 2-Problem 1

  1. $2.75 per bushel

  2. 300 x $2.75 = $825,000 (the quantities for supply and demand are in thousands)

  3. 320 - 290 = 30 thousand bushel surplus (there is a surplus since the price floor is above the market equilibrium)

  4. $3.25 x 30 thousand bushels = $97,500


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