1. In the market for tea, quantity demanded is given Q = 5 – P/2 and quantity supplied is given by Q = P/2, where Q represents tonnes of tea per year. Suppose that the government provides a subsidy of $2 per ton of tea. After the introduction of the subsidy, the equilibrium price and quantity will be
2. Suppose that weekly demand for wool is given by P = 900 – Q, and supply is given by P = 2Q, where Q represents tonnes of wool. To support wool farmers, the government decides to impose a price floor of $400 per tonne. If the government agrees to buy any excess supply, it will have to spend _____ to buy _____ tonnes of wool.