Economics: Principles and Policy (MindTap Course List)
13th Edition
ISBN: 9781305280595
Author: William J. Baumol, Alan S. Blinder
Publisher: Cengage Learning
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Chapter 4, Problem 4DQ
To determine
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identify which of the determinants of the demand or supply are affected. Also indicate whether demand or supply increase or decreases…
Demand and supply often shift in the retail market for gasoline. Here are two demand curves and two supply curves for gallons of gasoline in the month of May in a small town in Maine. Some of the data are missing.
Using the table, answer the following questions:
Quantities Demanded Quantities Supplied
Price
D1
D2
S1
S2
$ 4.00
5,000
7,500
9,000
9,500
6,000
8,000
8,000
9,000
2.00
8,500
8,500
9,000
5,000
Instructions: Enter your answers as whole numbers.
A) use the following facts to fill in the missing data in the table. If demand is D1 and supply is S1, the equilibrium quantity is 7,000 gallons per month. When demand is D2 and suppy is S1, the equilibrium price is $ 3.00 per galllon. When demand is D2 and supply is S1, there is an excess demand of 4,000 gallons per month at a price of $ 1.00 per gallon. If demand is D1 and supply is S2, the equilibrium quantity is 8,000 gallons per month.
B) Compare the two…
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Economics: Principles and Policy (MindTap Course List)
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