Why would a free market never operate at aquantity greater than the equilibrium quantity? Hint:What would be required for a transaction to occur at thatquantity?
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Why would a free market never operate at a
quantity greater than the equilibrium quantity? Hint:
What would be required for a transaction to occur at that
quantity?
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- Consider the market for gasoline that is initially in equilibrium. Suppose that the Middle East, a major supplier of petroleum used to produce gasoline, erupts into war. At the same time suppose that the price of electric vehicles falls. Given these changes and holding everything else constant, what happens to the equilibrium price and quantity in the market for gasoline relative to the initial equilibrium price and quantity in the market a. The equilibrium price may increase, decrease or remain the same while the equilibrium quantity will decrease b. The equilibrium price may increase, decrease or remain the same while the equilibrium quantity willincrease c. The equilibrium price will increase while the equilibrium quantity may increase, decrease or remain the same d. The equilibrium price will decrease while the equilibrium quantity may increase, decrease or remain the samno graphs, please Assume that the markets for sugar cane, rum, and whiskey are initially in equilibrium(i.e., supply equals demand in each case). Assume further that a good harvest impactsthe world’s sugar cane crop. Sugar cane is a principal ingredient in rum, but it is notan ingredient in whiskey. Rum and whiskey are substitutes in consumption. Discuss the impact of the good harvest on each of the three markets.Assume that we are looking at the egg market and presently the equilibrium price for a dozen eggs is $3.50 and the present equilibrium quantities are at 5 million dozen. Suppose the price of chicken feed that is fed to egg producing chickens triples in price. Which of the following best describes the impact that this would have on the egg market? Holding all other variables constant. The gunnly curva sould doorocco chifting to the
- In the market for automobiles, firms in the industry are able to buy the steel for the cars at a lower price. This causes a) Both the equilibrium price and the equilibrium quantity to increase. b) The equilibrium price to increase and the equilibrium quantity to decrease Oc) The equilibrium price to decrease and the equilibrium quantity to increase d) Both the equilibrium price and the equilibrium quantity to decreaseAssume that the market price for beach towels increases considerably due to a worldwide shortage in the fabrics needed to produce them. Furthermore, suppose that some of these same fabrics are used in the production of bathing suits as well. Create a graphical depiction of the market for bathing suits (which are thought to be a complementary good to beach towels), making sure to indicate how the market will be impacted by the discussed changes. Make a conclusion about how the market price and equilibrium quantity of bathing suits will be affected.Suppose that the market for milk can be represented by the following equations: Demand: P = 12 – 0.5QD Supply: P = 0.1QS where P is the price per gallon, and Q represents quantity of milk, represented in millions of gallons of milk consumed per day. a) Calculate the equilibrium price and quantity of milk. b) To help dairy farmers, the government sets a minimum price of K2.50 per gallon of milk. What is the new quantity of milk sold in the marketplace?
- Consider the market for gasoline, illustrated in the figure to the right. The equilibrium quantity of gasoline is 15 million gallons (enter a numeric response using a real number rounded to two decimal places) and the equilibrium price is $2.50 per gallon. If instead the market price were $3.25, then there would be a of million gallons. Price of Gasoline (per gallon) 5.00 4.50- 4.00 3.50- 3.00 2.50- 2.00 1.50- 1.00 0.50- 0.00- S D 3 6 9 12 15 18 21 24 27 Quantity of Gasoline (gallons in millions) 30 + OThe weekly demand and supply schedules for T-shirts (in millions) in a free market are as follows: Price Quantity demanded Quantity supplied 8 6 18 7 8 16 6 10 14 5 12 12 4 14 10 3 16 8 2 18 6 1 20 4 4.Assume that changes in fashion cause the demand for T-shirts to rise by 4 million at each price. What will be the new equilibrium price and quantity? Has equilibrium quantity risen as much as the rise in demand? Explain why or why not. 5.Now plot the data in the table and mark the equilibrium. Also plot the new data corresponding to (b).The demand for corn (measured in billions of bushels) is given by Con = 5 - 2Pom + 4Ppotutoes - 0.25Putter + 0.0003M. The supply of corn is given by O=9+ 5Pun - 2Puet -1.25Pybeans a. If potatoes cost $0.75 per pound, butter costs $8.00 per pound, diesel fuel costs $3.00 per gallon, soybeans cost $16.00 per bushel, and average income, M, is $40,000 per year, what is the equilibrium price of corn as determined by the demand and supply functions? Instructions: Round your answer to 1 decimal place, b. How much corn is bought and sold (equilibrium quantity? Instructions: Round your answer to 1 decimal place. Obillion bushels. c. If the price of diesel fuel increases to $4.50 per gallon, what is the new equilibrium price? Instructions: Round your answers to 2 decimal places. If the price of diesel fuel increases to $4.50 per gallon, what is the new equilibrium quantity? billion bushels,
- Please no written by hand solutions No equilibrium price nor equilibrium quantity exists if a good's demand curve is vertical line and its supply curve is a horizontal line. true or false?1. Which of the following will result in an uncertainty regarding any change that might occur in the equilibrium quantity but a definite increase in the equilibrium price? a) An increase in demand and a decrease in supply b) A decrease in demand and a decrease in supply c) A decrease in demand and an increase in supply d) An increase in demand and an increase in supply 2. In a production possibility frontier (PPF) graph it is observed that points 1,2,3, and 4 lie on the PPF, Point 5 is outside the PPF, and point 6 is inside the PPF. Which of the following statements is correct? a) Point 6 can be produced only if there is an increase in resource availability and/or an improvement in technology. b) Points 1-4 and 6 can be produced with the currently available resources and technology, but resources are used efficiently only at points 1-4. c) Point 5 can be produced with the currently available resources and technology, but the resource use is inefficient. d) Point 6 can be produced with…2. Suppose the market for rum can be described by the following equations: Demand: P = 10 – Q Supply: P = Q-4 where P is the price in US dollars per unit and Q is the quantity in thousands of units. Then: What is the equilibrium price and quantity? a. b.
