Use the following data to draw supply and demand curves on the accompanying graph.
|
Price
|
$ 8
|
7
|
6
|
5
|
4
|
3
|
2
|
1
|
|
Quantity demanded
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
|
Quantity supplied
|
10
|
9
|
8
|
7
|
6
|
5
|
4
|
3
|
(a) What is the equilibrium price?
(b) If a minimum price (price floor) of $6 is set,
(i) What kind of disequilibrium situation results?
(ii) How large is it?
(c) If a maximum price (price ceiling) of $3 is set,
(i) What disequilibrium situation results?
(ii) How large is it? Illustrate these answers.