Consider a market where supply and demand are given as:
Qd = 56 - 2P Qs = -10 + P
Suppose the government imposes a price floor of $25, and agrees to purchases any and all units consumers do not buy at the floor price of $25 per unit (3 points)
a. Determine the cost to the government of buying firms' unsold units.
b. Compute the social welfare (deadweight loss) that stems from the $25 price floor