Determine the effect on the market of “watches”, by first showing the graph of demand and supply equilibrium, and how the 3 conditions affect the market of watches? Justify your points by proving it graphically.Current Equilibrium price of watches = $260Quantity demanded against the equilibrium = 500Condition 1: Price ceiling has been imposed by government = $200Condition 2: Price floor has been set to = $200Condition 3: If Price floor has been imposed by government of price = $300

The equilibrium price for a good or service is determined by the market forces of demand and supply.…

Answered: Determine the effect on the market of…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Determine the effect on the market of “watches”, by first showing the graph of demand and supply equilibrium, and how the 3 conditions affect the market of watches? Justify your points by proving it graphically.

Current Equilibrium price of watches = $260
Quantity demanded against the equilibrium = 500
Condition 1: Price ceiling has been imposed by government = $200
Condition 2: Price floor has been set to = $200
Condition 3: If Price floor has been imposed by government of price = $300

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