The following diagram shows a market in which a government maximum price has been set.Which of the following statements is correct?Preis111096Höchstpreis---- - -4|32Mengo8.Choose an answer:1. The excess demand is 2.2. The excess supply is 2.O 3. The market is in equilibrium at this maximum price.O 4. The amount sold is 6.O 5. The maximum price is not binding.QO00 O

Demand Curve: - demand curve is the graphical way of showing the relationship between the quantity…

Answered: The following diagram shows a market in…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Adam is willing to buy a bottle of water at the price of $2/bottle. Bryan is willing to buy three bottles of water at the price of $1.5/bottle. Cathy is willing to buy two bottles of water at the price of $1.75/bottle. The market price is $1.75/bottle. What is the consumer surplus? $0.25 O $0.15 O $1.75 O $2
In Figure below, using the supply and demand curves denoted S1 and D1, respectively, Price $150 $100 $75- $50 1 I 50 75 100 O surplus Quantity (thousands) if demand were to increase to D2 and the equilibrium price stayed the same there would be shortage new equilibrium at 75,000 new equilibrium at 100,000 D₂ new equilibrium at 50,000
The market equilibrium is considered stable. If a business set a price too high they would know because O The QS would be less than the QD causing a shortage. O The QS would be greater than QD causing a surplus. O The QS would be less than the QD causing a surplus. O The QS would be greater than the QD causing a shortage.
Using supply and demand B as the market Figure 6-11 Price 20 18 16 12 10 8 6 DemandA 36 9 12 15 18 21 24 27 30 Quantity O binding O non-binding Supply O it is at equilibrium Refer to Figure 6-11. If the government imposes a price floor at $12, it would be DemandB Both A and D are correct O it will generate a permanent shortage of 6 K
III. Demand and Supply Together Table 3: Demand and Supply Together Qd 10 15 20 P $4.00 $3.50 $3.00 $2.50 $2.00 P 4.00 Below, superimpose the demand and supply curves. 3.00 2.00 25 30 1.00 Qº 10 30 25 20 15 10 20 30 40 Show Transcribed Text c Q If the price were $4.00, what would the situation in the market be? What (if anything) do you think competing sellers would tend to do (and why)? If the price were $2.00, what would the situation in the market be? What (if anything) do you think competing sellers would tend to do (and why)? At a price of $3.00, what would the situation in the market be? What (if anything) do you think competing sellers would tend to do (and why)?
An alternative way of thinking about the forces that cause markets to equlibrate in the real world is to think of markets reallocating the good from low to high valued use. Or to think of how the action of buyers and sellers engaging in mutually beneficial voluntary exchange (market forces) reallocates legal ownership or the physical location of the good from low to high valued used. Consider the demand at a price of $9. 12 10 8 6 4 2 0 02 units 10 20 30 40 Price 10 9 8 7 6 5 4 3 2 Price 10 9 1 8 7 6 5 4 3 2 1 Ying 0 0 0 0 1 1 Boom 1 0 0 0 0 0 0 0 0 0 1 1 1 1 Som 0 0 0 0 3 3 3 5 5 7 Oiy 7 5 5 3 3 0 0 0 0 0 Quantity Demanded Fon Nam 0 0 0 0 1 2 3 5 0 0 0 4 6 7 8 10 12 7 9 11 Quantity Supplied Cartoon Apple 6 11 5 9 4 7 3 5 2 3 1 2 0 1 0 0 0 0 0 0 Gob 0 1 2 4 6 8 8 10 10 10 Kai 10 10 10 8 8 6 4 2 Yam 0 1 2 4 5 5 5 Market Supply ➡Market Demand 1 0 5 5 7 Mint 7 5 5 5 5 5 4 2 Market Demand 0 2 4 9 21 26 29 36 40 48 1 0 Market Supply 42 34 31 24 21 14 9 4 2 0 2 units of the good are demanded…
1. The market price is $________ per bottle.2. The equilibrium quantity is ________ bottles.3. The price at which suppliers will not put any bottles on the market is $_______.4. What is the consumers’ surplus in the market at equilibrium $________ (assume the demand curve starts at $38)5. What is the producers’ surplus in this market at equilibrium $_______
Quantity Demanded 6 7 8 9 10 11 12 Price $8 7 6 5 4 3 2 Refer to the above table. If demand decreased by 4 units at each price and supply decreased by 2 units at each price, what would the new equilibrium price and quantity be? Multiple Choice O $6 and 6 units $5 and 5 units O $4 and 6 units Quantity Supplied 10 9 8 7 6 5 4 $7 and 7 units
Assume, the market price of milk is R.O 1.5 per liter. At this price, the buyers and sellers are able to buy and sell whatever they want. There is no shortage or surplus of milk in the market. From this context, analyze the statements given below and choose the correct statement. a. All of the options b. The price R.O 1.5 is the market clearing price of milk c. At the price R.O 1.5, the demand and supply of milk will be equal d. The price R.O 1.5 is the equilibrium price of milk
Consider the following figure. Price $4.00 O $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 0 5 15 Quantity A price floor set at $2.50 will result in 10 a surplus of 10 units. a surplus of 5 units. a shortage of 10 units. 20 25 30 a shortage of 5 units. no change to the market outcomes. Supply Demand 35 40
What would be the impact of a price floor of $12 A) There would be no impact B) a shortage of 12 units C) A surplus of 6 units D) A shortage of 6 units E) A surplus of 10 units

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