(A) Given the following data on individual supply and demand, calculate the market supply and demand. (B) what is the equilibrium price? (C) supposed the current price is $4, at this price, how much of a shortage or surplus exists in gallons?
(A) Given the following data on individual supply and demand, calculate the market supply and demand. (B) what is the equilibrium price? (C) supposed the current price is $4, at this price, how much of a shortage or surplus exists in gallons?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
(A) Given the following data on individual
(B) what is the
(C) supposed the current price is $4, at this price, how much of a shortage or surplus exists in gallons?
Transcribed Image Text:### Understanding Supply and Demand in the Gasoline Market
Below is a table outlining the demand and supply of gasoline at various price points. Use this data to calculate the market supply and demand, and identify the equilibrium price where supply meets demand.
#### Demand and Supply Schedule for Gasoline
#### Demand Table
| Price per Gallon | Quantity of Gasoline Demanded per Day |
|------------------|---------------------------------------|
| | Al | Betsy | Casey | Daisy | Eddie |
| $5 | 1 | 0 | 2 | 1 | 1 |
| $4 | 2 | 1 | 3 | 2 | 2 |
| $3 | 3 | 1 | 4 | 3 | 3 |
| $2 | 4 | 2 | 4 | 4 | 4 |
| $1 | 5 | 2 | 6 | 5 | 6 |
#### Supply Table
| Price per Gallon | Quantity of Gasoline Supplied per Day |
|------------------|---------------------------------------|
| | Firm A | Firm B | Firm C | Firm D | Firm E |
| $5 | 3 | 7 | 6 | 5 | 4 |
| $4 | 3 | 5 | 4 | 5 | 5 |
| $3 | 2 | 3 | 3 | 4 | 3 |
| $2 | 2 | 5 | 4 | 3 | 2 |
| $1 | 1 | 3 | 2 | 1 | 1 |
### Instructions:
1. Calculate the market totals for both demand and supply at each price point.
2. Identify the equilibrium price where the market demand equals the market supply.
### Market Total Demand & Supply Calculation
#### Demand:
- **Price: $5**
-
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