QUESTION 47 The equation for the quantity demanded (Qp) for a product is Qp = 400 - 20P where P = price in dollars. The quantity supplied (Qs) is given by Qs = 100 + 40P. What change will occur if the price rises from $5 to $6? O A. the market will move from surplus to shortage O B. the market will move from equilibrium to shortage OC. the market will move from equilibrium to surplus O D. the market will move from shortage to surplus

QUESTION 47 The equation for the quantity demanded (Qp) for a product is Qp = 400 - 20P where P = price in dollars. The quantity supplied (Qs) is given by Qs = 100 + 40P. What change will occur if the price rises from $5 to $6? O A. the market will move from surplus to shortage O B. the market will move from equilibrium to shortage OC. the market will move from equilibrium to surplus O D. the market will move from shortage to surplus

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter4: The Market Forces Of Supply And Demand

Section: Chapter Questions

Problem 8PA

See similar textbooks

Similar questions

What is the relationship between quantity Demanded and quantity supplied at equilibrium? What is the relationship when there is a shortage? What is the relationship when them is a surplus?
Would you expect supply to play a more significant role in determining the price of a basic necessity like food or a luxury like perfume? Explain. Hint: Think about how the price elasticity of demand will differ between necessities and luxuries.
What does a downward-sloping demand curve mean about how buyers in a market will react to a higher price?
Review Figure 3.4 again. Suppose the price of gasoline is 1.00. Will the quantity demanded he lower or higher than at the equilibrium price of 1.40 per gallon? Will the quantity supplied be lower or higher? Is them a shortage or a surplus in the market? If so, of how much? Figure 3.4 Demand and Supply of Gasoline
Suppose the cross-price elasticity of apples with respect to the price of oranges is 0.4, and the price of oranges falls by 3. What will happen to the demand for apples?
What is the difference between the demand and the quantity demanded of a product, say milk? Explain in words and show the difference on a graph with a demand curve for milk.
What is the effect of a price ceiling on the quantity demanded of the product? What is the effect of a price ceiling on the quantity supplied? Why exactly does a price ceiling cause a shortage?
What is the relationship between price elasticity and position on the demand curve? For example, as you move up the demand curve to higher prices and lower quantities, what happens lo the measured elasticity? How would you explain that?
Review Figure 3.4. Suppose the price of gasoline is 1.60 per gallon. Is the quantity demanded higher or lower than at the equilibrium price of 1.40 per gallon? What about the quantity supplied? Is there a shortage or a surplus in the market? If so, how much? Figure 3.4 Demand and Supply of Gasoline
Suppose both of these events took place at the same time. Combine your analyses of the impacts of the iPod and the tariff Induction to determine the likely impact on the equilibrium price and quantity of Sony Walkman-type products. Shaw your answer graphically.
Explain all the reasons why a decrease in a products price would lead to an increase in purchases.
If demand is inelastic, will shifts in supply have a larger effect on equilibrium price or on quantity?