Curvd SKILL WORKSHOP WORKING WITH SUPPLY AND DEMAND CURVEs In this chapter, supp
ID: 1129690 • Letter: C
Question
Curvd SKILL WORKSHOP WORKING WITH SUPPLY AND DEMAND CURVEs In this chapter, supply and de mand curves have been used to 2. At a price of St a dozen, la) allye to produce eggs. But if the pr" of chicken rises, they will Mustrate how markets operate We have used these graphs to heip understand the efflects of market forces in cotton, calzula- tors, big cars, and shares of stock. In this skill activity we'll use the graphs to Investigate how many eggs do people want to buy? (b) How many are suppliers willing to sup-sell them as meat. This wou plyt (c) wil a shortage or sur- make a change in the supply of plus exist id) Will prices tend egs. Let Sa in Figure 6-11 repre to rise or fall Whyt more wiling to kill some and sent the new supply of egss. 3. What ls the equilibrium price and quantiry of eggs for this weeki some more shuations. 20e Epgs in Equilibrium First consider the 15t Chickens or Ezast Suppose it is early December egs market in Compromise. Pgure 6-10 repre . and many people around town are planning to cook chicken for se Christmas dineer. The owners of the chickens realize that they have two options available to them. They ar, ki some of their chickens and sell them for sents the supply and demand for eggs for the coming week. 25c 20 40 60 B0 100 120 340 Figure 6-11 Questions buyt Effects of the Naw Supply Curve for Esss and continue to sell eggs. If the price of chicken in grocery stores is low, the own4. At 15c a dozen, how many ers of the chickens will probably eggs do people ndw want to 20600 100 120 140 10 most of their chickens Figure 6-10 The Eze Markcet Questions 1. At a price of 20t a dozen, how many eggs do people want to buyl (b) How many do the suppliers want to sup- ply? (c) Will a shortage or a surplus exist? (d) Wil market forces tend to increaserr crease the price ofExplanation / Answer
6-10
Demand curve is downward slopping from left to right. Supply curve is upward slopping from left to right.
1a.If the price is 20c, people’s buying could be found through the demand curve. The corresponding point on quantity axis is 50.
Answer: 50 numbers
1b. The number of supply could be found through supply curve. The corresponding point on quantity axis is 100.
Answer: 100 numbers
1c. There is surplus, since supply is higher than demand.
Answer: Surplus = Supply quantity – Demand quantity = 100 – 50 = 50 numbers
1d. Surplus happens because of higher price. Since demand is lower here, the price would be down to get more customers. It tends to decrease the price.
2a.If the price is 5c, people’s buying could be found through the demand curve. The corresponding point on quantity axis is 140.
Answer: 140 numbers
2b. The number of supply could be found through supply curve. The corresponding point on quantity axis is 40.
Answer: 40 numbers
2c. There is shortage, since supply is lower than demand.
Answer: Shortage = Demand quantity – Supply quantity = 140 – 40 = 100 numbers
2d. Shortage happens because of lower price. Since demand is higher here, it should push the price up. It tends to increase the price.
3. Equilibrium is a situation where both buyers and suppliers are happy to stay. This is the point where demand and supply intersect.
In the graph, these two intersect at 15c price and 80 numbers of quantities.
Answer: Equilibrium price is 15c; equilibrium quantity is 80 numbers.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.