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- In 2018, a cold front in Barbados increased both the demand for water heaters andgasolines. The usage of gasoline was 581 tonnes, an increase from 499 tonnes in theprevious year. The Petroleum Company of Barbados advised Government officials thatdemand could outweigh supply and asked companies to increase the supply. They alsoasked major gasoline users, such as power plants, to reduce demand. i. Illustrate the effect of the cold front on the demand for gasoline using a demandcurve diagram over the two years. ii. Assuming the Petroleum Company of Barbados did not issue a directive for anincrease in supply and a decrease in demand, explain the problem that would existin the economy and how would this be corrected over time.In 2018, a cold front in Barbados increased both the demand for water heaters andgasolines. The usage of gasoline was 581 tonnes, an increase from 499 tonnes in theprevious year. The Petroleum Company of Barbados advised Government officials thatdemand could outweigh supply and asked companies to increase the supply. They alsoasked major gasoline users, such as power plants, to reduce demand.i. Illustrate the effect of the cold front on the demand for gasoline using a demandcurve diagram over the two years. ii. Assuming the Petroleum Company of Barbados did not issue a directive for anincrease in supply and a decrease in demand, explain the problem that would existin the economy and how would this be corrected over time. iii. Illustrate the effect of major gasoline suppliers increasing supply as well as usersreducing their demand. iv. Discuss one factor EACH that you think influence demand and supply for waterheaters. Provide examples v. Is demand for gas is price elastic or price…Suppose that weekly demand for iron ore in Australia is given by P = 900 -Q and supply is gven by P = 20, where Qrepreserits tonnes of iron ore. To sunport consuens the government decides to impose a price ceiling of $400 per tonne if the govermment agrees to buy any escess supply, it will have to spend____________to buy___________ tonnes of inon ore. options are $180000;600 $90000;300 $240000;600 none is correct $120000;300
- What is the effect of a binding price ceiling on the quantity demanded of a product? O Demand will fall O Demand will rise O No change in demand O Supply will change in response to a change in demandOnly typed answer and please don't use chatgpt (I)Consider the market for milk in Saskatchewan. If p is the price of milk (cents per litre) and Qis the quantity of litres (in millions per month), suppose that the demand and supply curves formilk are given by: Demand: p = 225 -15QD Supply: p = 25 + 35QS a.Assuming there is no government intervention in this market, what is the equilibrium price and quantity? Equilibrium Price = $165 Quantity = 4Liters b. Now suppose the government guarantees milk producers a price of $2 per litre and promises to buy any amount of milk that the producers cannot sell. What are the quantity demanded and quantity supplied at this guaranteed price? Please answer B.In an economy you estimate the supply curve of milk to be Ps = 3+Q and the demand curve to be PD = 5-2Q, where Q is the millions of litres and P is price in dollars. WNhat Would be the market clearing price and what is the effect of a price ceiling of $3/Aitre? O A The market clearing price would be $2 and a price ceiling would have no impact. O B. The market clearing price would be $3.67 and a price ceiling would have no impact. O C. The market clearing price would be $3.67 and a price ceiling would induce a shortage of-1 million litres. O D. The market clearing price would be $4.33 and a price ceiling would induce a shortage of-5 million litres.
- Which of the following would be the most likely result of a binding price ceiling imposed on the market for rental cars? Select one: O a. slow replacement of old rental cars with newer ones Ob. frequent rental programs such as "Rent nine times and the tenth rental is free!" O c. free gasoline given to people as an incentive to a rent a car O d. enhanced maintenance programs to promote the high quality of the cars Next page IMG_7969.jpeg UPEGplease explain to me step by step how to find the equilibrium price i more detail than before, how do you choose which terms to move to the other side of the equation, and why when moved they are positive or negative the answer that i received before, when i substitute the price in de demand and in the supply equation, i dont get the same answer The following represents demand for widgets (a fictional product): QD = -47,214 – 90P + 0.8M - 2PR where P is the price of widgets, M is income, and PR is the price of a related (fictional) good, the wodget. Supply of widgets is determined by QS = 400P – 15,550 Determine whether widgets are a normal or inferior good, and whether widgets and wodgets are substitutes or complements. Assume that M = $68,500 and PR = $53. Solve algebraically to determine the equilibrium price and quantity of widgets. Generate a supply/demand graph in Excel. Be sure that P is the vertical axis and Q the horizontal. Does the graphical equilibrium correspond to…It is an illegal market that emerges when binding and nonbinding price controls are in place. It is an illegal market that emerges when binding price ceilings are in place. O It is an illegal market that emerges when binding price floors are in place. It is an illegal market that emerges when only binding price ceilings and binding price floors are in place.. It is an illegal market that em erges when no price controls are present. Save Question 10 You would expect there to be many customers for a black market good when the opportunity cost of finding the good under a: O binding price floor is high. binding price floor is low. nonbinding price ceiling is high. binding price ceiling is low. binding price ceiling is high.
- 8. Suppose the total demand for wheat and the total supply of wheat per month in the Kansas City grain market are as shown in the table below. Suppose that the government estab- lishes a price ceiling of $3.70 for wheat. What might prompt the government to establish this price ceiling? Explain care- fully the main effects. Demonstrate your answer graphically. Next, suppose that the government establishes a price floor of $4.60 for wheat. What will be the main effects of this price floor? Demonstrate your answer graphically. LO3.6 Thousands of Bushels Thousands of Demanded Price per Bushel Bushels Supplied 85 $3.40 72 80 3.70 73 75 4.00 75 70 4.30 77 65 4.60 79 60 4.90 81Assume that the government sets a binding price ceiling on the interest rate that banks charge on loans.Explain carefully the impact of this policy on the financial markets. Assume that the government sets a price floor in the market for wheat and the price floor is set below themarket equilibrium of wheat. Discuss carefully the effectiveness of this policy on the marketV n KV IM *00 IN ((0 B 44R FL 1. 3. Price (S/cup) Refer to the accompanying figure, which shows the market for cups of coffee. Consider the original supply and the original demand curve. If the government imposes a price ceiling of $1.00 on a cup of coffee, then there would be: 4. Original Supply 3.5 New Supply 2.5 2. 1.5 New Demand 0.5 Original Demand 40 Quantity (cups/hour) 06 08 09 Multiple Choice an excess supply of coffee. < Prev 11 of 27 MI here to search Kuung 76 PrtSc Insert Delete F10 F11 F12 F8 & Backspace 423 7. 6 3. H. Alt Ctrl