The supply and demand curves for corn are as follows:
QD = 3,750 - 725P
QS = 920 + 690P,
where Q = millions of bushels and P = price per bushel.
a. Calculate the equilibrium price and quantity that would prevail in the free market.
b. The government has imposed a $2.50 per bushel support price. How much corn will the government be forced to purchase?