Answer in step by step with explanation.Don't use Ai and chatgpt Q+QThe above graph shows a market in equilibrium at P* and Q*. Yet, simultaneously the orange line represents a government imposed regulation onprice. Based on what we see in the graph and what we know about price ceilings and price floors, answer the following:a. Is this a price ceiling or a price floor? Why?b. Will this situation cause excess demand or excess supply? Why?

Step 1: Understanding the GraphThe blue line represents the demand curve, which is downward sloping…

Answered: Q+ Q The above graph shows a market in…

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter4: Supply And Demand: An Initial Look

Section: Chapter Questions

Problem 4DQ

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Table 3.10 shows the supply and demand for movie tickets in a city. Graph demand and supply and identify the equilibrium. Then calculate in a table and graph the effect of the following changes. Three new nightclubs open. They offer decent bands and have no cover charge, but make their money by selling food and drink. As a result, demand for movie tickets falls by six units at every price. The city eliminates a tax that it placed on all local entertainment businesses. The result is that the quantity supplied of movies at any given price increases by 10%.
The following table summarizes information about the market for principles of economics textbooks: What is the market equilibrium price and quantity of textbooks? To quell outrage over tuition increases, the college places a $55 limit on the price of textbooks. How many textbooks will be sold now? While the price limit is still in effect, automated publishing increases the efficiency of textbook production. Show graphically the likely effect of this innovation on the market price and quantity.
The following table summarizes information about the market for principles of economics textbooks: Price Quantity Demanded per Year Quantity Supplied per Year $45 4,300 300 55 2,300 700 65 1,300 1,300 75 800 2,100 85 650 3,100 What is the market equilibrium price and quantity of textbooks? To quell outrage over tuition increases, the college places a $55 limit on the price of textbooks. How many textbooks will be sold now? While the price limit is still in effect, automated publishing increases the efficiency of textbook production. Show graphically the likely effect of this innovation on the market price and quantity.
Explain why the following statement is false: In the goods market, no buyer would be willing to pay more than me equilibrium price.
The computer market in recent years has seen many more computing sell at much lower prices. What shift in demand or supply is most likely to explain this outcome? Sketch a demand and supply diagram and explain your reasoning for each. A rise in demand A fall in demand A rise in supply A fall in supply
When someones kidneys fail, the person needs to have medical treatment with a dialysis machine (unless or until they receive a kidney transplant) or they will die. Sketch a supply and demand diagram, paying attention to the appropriate elasticities, to illustrate that the supply of such dialysis machines will primarily determine the pure.
Select the correct answer. A price ceiling will usually shift: demand supply both neither
What would be the impact of imposing a price flour below the equilibrium price?
The price of coffee rose sharply last month, while the quantity sold remained the same. Five people suggest various explanations: Leonard: Demand increased, but supply was perfectly inelastic. Sheldon: Demand increased, but it was perfectly inelastic. Penny: Demand increased, but supply decreased at the same time. Howard: Supply decreased, but demand was unit elastic. Raj: Supply decreased, but demand was perfectly inelastic. Who could possibly be right? Use graphs to explain your answer.
Will supply curves have the same shape in all markets? If not, how will they differ?

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