Market equilibrium worksheet 1. In the diagram to the right, plot the following hypothetical supply and demand information for personal computers (PCs): Price 3000 Quantity Demanded (Qd - millions) Price ($) $3,000 2,500 2,000 1,500 1,000 Quantity Supplied (Qs - millions) 2500 2000 17 4 16 1500 7 14 1000 11 11 16 7 500 22 500 8 12 16 20 24 Personal computers (millions The equilibrium price "clears the market," in that quantity demanded equals quantity supplied. The equilibrium price = 2. 3. At a price of $2,500... At a price of $1,000... (1) Is there excess demand or excess supply? (2) How many million units? (3) Are PC inventories rising or falling? (4) Is the incentive to raise or lower price? 4. Indicate whether equilibrium price (P) and quantity (Q) will rise (+) or fall (-) if ... Price Quantity (1) Demand shifts right (2) Demand shifts left Supply shifts right Supply shifts left (3) (4)

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Jim Whitney
Economics 101
Market equilibrium worksheet
In the diagram to the right, plot the following hypothetical supply and demand
information for personal computers (PCs):
1.
Price
3000
Quantity Demanded
(Qd - millions)
Price
($)
Quantity Supplied
(Qs - millions)
2500
2000
2
$3,000
17
2,500
2,000
4
16
1500
7
14
1000
11
1,500
11
16
1,000
7
500
22
500
2
12 16 20 24
Personal computers (millions)
4
8
The equilibrium price "clears the market," in that quantity demanded equals quantity supplied.
The equilibrium price =
2.
3.
At a price of $2,500...
At a price of $1,000...
(1) Is there excess demand or excess supply?
(2) How many million units?
(3) Are PC inventories rising or falling?
(4) Is the incentive to raise or lower price?
4. Indicate whether equilibrium price (P) and quantity (Q) will rise (+) or fall (-) if ...
Price
Quantity
Demand shifts right
(1)
Demand shifts left
(2)
Supply shifts right
(3)
(4)
Supply shifts left
Transcribed Image Text:Jim Whitney Economics 101 Market equilibrium worksheet In the diagram to the right, plot the following hypothetical supply and demand information for personal computers (PCs): 1. Price 3000 Quantity Demanded (Qd - millions) Price ($) Quantity Supplied (Qs - millions) 2500 2000 2 $3,000 17 2,500 2,000 4 16 1500 7 14 1000 11 1,500 11 16 1,000 7 500 22 500 2 12 16 20 24 Personal computers (millions) 4 8 The equilibrium price "clears the market," in that quantity demanded equals quantity supplied. The equilibrium price = 2. 3. At a price of $2,500... At a price of $1,000... (1) Is there excess demand or excess supply? (2) How many million units? (3) Are PC inventories rising or falling? (4) Is the incentive to raise or lower price? 4. Indicate whether equilibrium price (P) and quantity (Q) will rise (+) or fall (-) if ... Price Quantity Demand shifts right (1) Demand shifts left (2) Supply shifts right (3) (4) Supply shifts left
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