18-19. In the competitive market for white sugar, consumer demand is given by P=100-0.050 andsuppliers' behaviour is represented by the supply curve of P=1+0.005Q, where P is measured in dollarsand Q is measured in kilos per month. Questions 17 through 19 refer to this market.18. Imagine now that the government imposes a price ceiling of $5.00 per kilo on sugar, and that theceiling is obeyed by all market participants. In the resulting equilibrium the total number of kilos of sugarexchanged in the market is equal to:A) 2100G) 800B) 2000H) 600A) $5G) $70C) 1900I) 400B) $10H) $8019. Suppose suppliers obey the price ceiling but consumers sell sugar on a black market. What will theblack market price for sugar be?D) 1400 E) 1200J) None of the aboveC) $10.50I) $21E) $50F) 1000D) $40J) None of the aboveF) $60

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ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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Question

18-19. In the competitive market for white sugar, consumer demand is given by P=100-0.050 and
suppliers' behaviour is represented by the supply curve of P=1+0.005Q, where P is measured in dollars
and Q is measured in kilos per month. Questions 17 through 19 refer to this market.
18. Imagine now that the government imposes a price ceiling of $5.00 per kilo on sugar, and that the
ceiling is obeyed by all market participants. In the resulting equilibrium the total number of kilos of sugar
exchanged in the market is equal to:
A) 2100
G) 800
B) 2000
H) 600
A) $5
G) $70
C) 1900
I) 400
B) $10
H) $80
19. Suppose suppliers obey the price ceiling but consumers sell sugar on a black market. What will the
black market price for sugar be?
D) 1400 E) 1200
J) None of the above
C) $10.50
I) $21
E) $50
F) 1000
D) $40
J) None of the above
F) $60

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