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In: Economics

Complete the following table by indicating at each price whether there is a shortage or surplus in the market, the amount of that shortage or surplus, and whether this places upward or downward pressure on prices.

 9. 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.

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 The equilibrium price in this market is _______  per calendar, and the equilibrium quantity is _______  calendars bought and sold per month.

 Complete the following table by indicating at each price whether there is a shortage or surplus in the market, the amount of that shortage or surplus, and whether this places upward or downward pressure on prices.

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Solutions

Expert Solution

The equilibrium price is $40 per calender and quantity is 250 calenders. This occurs at the intersection of demand and supply curves.
Price Quantity of calenders demanded Quantity of calnders supplied Surplus/shortage Shortage/Surplus Amount Pressure on prices
Dollars per calender Millions of boxes Calenders
$32 375 200 Shortage 175 Upward pressure
$48 125 300 Surplus 125 Downward pressure
When there is a shortage, the demand for goods will be much higher and produrcers will increase the price of goods. There will be an upward pressure.
When there is a surplus, producers will have unsold stock and would be willing to sell their goods at lower prices. There is a downward pressure on prices

Rahul Sunny answered 2 years ago
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