a) How to plot the demand and supply curves on a two-dimensional diagram ? b) What is the equilibrium price and equilibrium quantity traded ? c) What is the value of excess demand or supply when price is (i) $8, (ii) $13 ?
Price 8 9 10 11 12 13 14
QD 110 100 90 80 70 60 50
QS 20 40 60 80 100 120 140
Suppose that in 2008 the quantity supplied in the table above is unchanged. The quantity demanded, however, has increased by 20 million at each price level. Is this an increase or a decrease in demand?
Price 8 9 10 11 12 13 14
QD 110 100 90 80 70 60 50
QS 20 40 60 80 100 120 140
Suppose that in 2008 the quantity supplied in the table above is unchanged. The quantity demanded, however, has increased by 20 million at each price level. Is this an increase or a decrease in demand?
1 Answer
Oct 16, 2016
read explaination
Explanation:
a)the demand has a negative relation with price so it will be sloping upwards like this slash /
the supply curve has a positive causal relationship with price so the curve will slope downwards... the opposite of the slash above^.
b)The equilibrium price is where the supply of goods matches demand.
Equilibrium quantity is simultaneously equal to both the quantity demanded and quantity supplied.
question c) requires more information
sorry!
but i do hope my answers for a) and b) helped!
