ECON 203 Study Guide - Quiz Guide: Demand Curve, Economic Equilibrium, Complementary Good
23 Mar 2019
School
Department
Course
Professor
Document Summary
Technological change is constant in the modern world. In terms of supply and demand, these technological changes mean that producers and suppliers can supply the same amount of a good or service at a reduced price. They thus result is a "lower" or more "rightward" supply curve: suppose that the market demand curve for wheat is qd = 300 5p and the market supply curve is qs= . Ans: the equilibrium price and equilibrium quantity are per unit and 150, respectively. (ii) suppose the government decides to have a price support program with a price floor set at pf = 40. Under a price floor program, the government sets this price and the producers decide how many units they want to sell. The consumers pay the support price for the units they buy, while the government buys up the excess supply. Ans: at the floor price of per unit, excess supply is 150 ( = 250-100 ).
