Untitled

import matplotlib.pyplot as plt
import numpy as np

# Create data for the demand and supply curves
P = np.linspace(0, 5, 100)
Qd = 10 - 2 * P  # Demand curve equation
Qs = 2 + 2 * P   # Supply curve equation

# Equilibrium point
Pe = 2
Qe = 6

# Price floor level
Pf = 3.5

# Quantity demanded and supplied at the price floor
Qd_floor = 10 - 2 * Pf
Qs_floor = 2 + 2 * Pf

# Setup figure and axis
fig, ax = plt.subplots()

# Plot the demand and supply curves
ax.plot(Qd, P, label="Demand (Qd)", color='blue')
ax.plot(Qs, P, label="Supply (Qs)", color='orange')

# Mark equilibrium
ax.scatter(Qe, Pe, color='red', zorder=5)
ax.text(Qe - 0.5, Pe + 0.1, f"Equilibrium (Q={Qe}, P={Pe})", color='red')

# Mark price floor
ax.axhline(y=Pf, color='green', linestyle='--', label=f"Price Floor (P={Pf})")

# Mark points for surplus
ax.scatter(Qd_floor, Pf, color='purple', zorder=5)
ax.scatter(Qs_floor, Pf, color='purple', zorder=5)
ax.text(Qd_floor + 0.2, Pf + 0.1, f"Qd={Qd_floor}", color='purple')
ax.text(Qs_floor + 0.2, Pf + 0.1, f"Qs={Qs_floor}", color='purple')

# Shaded region for deadweight loss
ax.fill_betweenx([0, Pf], Qd_floor, Qs_floor, color='gray', alpha=0.3, label="Deadweight Loss")

# Labels and title
ax.set_xlabel("Quantity")
ax.set_ylabel("Price")
ax.set_title("Price Floor: Surplus and Deadweight Loss")
ax.legend()

# Show the plot
plt.grid(True)
plt.show()