Demanded Supplied Price (dollars (millions of (millions of pounds) 63 71 79 87 9

Question

Demanded Supplied Price (dollars (millions of (millions of pounds) 63 71 79 87 95 103 per pound) $0.80 0.90 1.00 1.10 1.20 1.30 1.40 1.50 1.60 1.70 1.80 107 104 101 98 95 92 89 86 83 80 119 127 135 143 instructions: Round your answer for price to two decimal places. Enter your answers for quantity as a whole numbe a. What are the equilibrium price and quantity in the wholesale butter market? P-$1 per pound o- million pounds b. What is the monthly surplus created in the wholesale butter market due to the price support (price floor) program? 11 million pounds Zero 22 million pounds 79 million pounds

Explanation / Answer

1) Solution: Equilibrium quantity: 95 million pounds; Equilibrium price $1.20 per pound

Working: At the price demand equals supply

2) Solution: Zero

Explanation: When the price floor is below a equilibrium market price, it will cause no direct effect. In the current situation the equilibrium is at $1.2 and floor is at 1 thus no surplus occurs

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.