With a suitable diagram, determine producer and consumer surpluses for a product characterized by D = 80-P, S=2P-100. Calculate the deadweight loss of imposing a per unit tax of £7.50.

b) i) At the initial equilibrium price, the area that represents producer surplus is the area above the supply curve and below the equilibrium price P_1, up to the quantity Q_1. Producer surplus: d + f ii) After the price ceiling is imposed at P_2, the quantity traded is Q_2. The area that represents consumer surplus is the area below the demand curve and above the price ceiling P_2, up to the quantity Q_2. Consumer surplus: a + b The area that represents producer surplus is the area above the supply curve and below the price ceiling P_2, up to the quantity Q_2. Producer surplus: f iii) The deadweight loss resulting from the price ceiling is the loss of total surplus due to the reduction in quantity traded from Q_1 to Q_2. This area is between the demand and supply curves for the quantities no longer traded. Deadweight loss: c + e