12. Market equilibrium and disequilibrium The following graph shows the monthly
ID: 1156549 • Letter: 1
Question
12. Market equilibrium and disequilibrium The following graph shows the monthly demand and supply curves in the market for calendars. Use the graph input tool to help you answer the following questions. Enter an amount into the Price field to see the quantity demanded and quantity supplied at that price. You will not be graded on any changes you make to this graph Graph Input Tool Market for Calendars Price (Dollars per calendar) Supply 80 Quantity Demanded (Calendars) Quantity Supplied (Calendars) 500 210 Demang LL 30 20 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Calendars)Explanation / Answer
a) The equilibrium price in the market is where the supply is equal to the demand. Here, the equilibrium price is $50 and quantity is 250.
b) when the price is $40 there is a shortage in the market of 150 and it will create an upward pressure in the market.
c) When the price is $60 there will be a surplus of 150 and there will be downward pressure in the market.
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