Business, 29.09.2019 16:30 mermaid1304

About 100 million pounds of jelly beans are consumed in the united stats each year, and the price has been about 50 cents per pound. however, jelly bean producers feel that their incomes are too low and have convinced the government that price supports are in order. speciﬁcally, the government has agreed to buy up as many jelly beans as necessary to keep the price at $1 per pound. however, government economists are worried about the impact of this program because they have no estimates of the elasticities of jelly bean supply or demand.
a. could this program cost the government more than $50 million per year? under
what conditions? illustrate with a diagram.

b. could this program cost consumers in terms of lost consumer surplus more that $50 million? under what conditions? again, illustrate with a diagram.

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About 100 million pounds of jelly beans are consumed in the united stats each year, and the price ha...

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