In the preceding question, suppose that the supply and demand describe an agricultural market rather than a labour market, and the government implements a price floor of $140. This is greater than the equilibrium price.
(a) Estimate the quantity supplied and the quantity demanded at this price, and calculate the excess supply.
(b) Suppose the government instead chose to maintain a price of $140 by implementing a system of quotas. What quantity of quotas should the government make available to the suppliers?