The current price of blue jeans is $30 per pair, but the equilibrium price of blue jeans is $25 per pair. As a result, a. the qu
antity supplied of blue jeans exceeds the quantity demanded of blue jeans at the $30 price. b. the equilibrium quantity of blue jeans exceeds the quantity demanded at the $30 price. c. there is a surplus of blue jeans at the $30 price. d. All of the above are correct.
1 answer:
Answer:
d. All of the above are correct.
Explanation:
- If the current price exceeds equilibrium price, suppliers are willing to sell more units than in equilibria conditions (Qs in the picture below) , and consumers are willing to buy less units than in equilibria conditions (Qd in the picture below), as shown in the graph that has been attached.
- Then, quantity supplied is greater than quantity demanded (Qs>Qd).
- Equilibrium quantity (Q* in the picture) exceeds quantity demanded at $30 price (Qd in the picture), which is related to the decreased in quantity demanded when prices increases: in equilibrium prices are lower than $30, then consumers are willing to buy more.
- Because quantity supplied is greater than quantity demanded, there is a surplus of blue jeans at $30 price (the different between the amount that consumers are willing to buy and the amount suppliers are willing to sell is positive, and its magnitude equals the surplus of blue jeans).
- See picture attached.
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Answer:
Follows are the solution to the given points:
Explanation:
In point a:
This business of plastic containers is increasing its Lunchbox Product Signature price around $3.00 and $4.00. The volumes produced consequently declined around 20,000 to 15,000.
The price elasticity also becomes unitary
In point b:
U.S. economic theory states that the elasticity of fuel demand is 0.5 because prices would be less than 1 and so are non-elastic.
In point c:
The capital Metro agrees and add $2.00 to $2.21 also for bus fares. Consequently, with an average of 70,000 drivers a days to both a daily average 61,000 drivers, its passenger numbers who take the bus in Austin falls.
The value being higher than 1 is elastic.