Problem
With the following information below- need assistance on 1, 2 and 3.
P=26
Q=33672
Q*=2800
Output level =0 and long run equilibrium
1. Discuss how this will affect the short-term demand curve for milk.
2. Discuss how this will affect the short-term supply curve for milk.
3. Use a graph showing demand and supply curves to show how this affects the equilibrium price and quantity. Make sure your demand and supply curves follow the law of demand and supply, the curves and axes are appropriately labeled, arrows indicating movement of curves are shown, and the old and new equilibrium prices are quantities are clear.