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A recent study found that the demand and supply schedules for Frisbees are as follows
Chapter 6, Problem Problems and Applications 6.3(choose chapter or problem)
A recent study found that the demand and supply schedules for Frisbees are as follows: Price per Quantity Quantity Frisbee Demanded Supplied $11 1 million Frisbees 15 million Frisbees 10 2 12 9 4 9 8 6 6 7 8 3 6 10 1 a. What are the equilibrium price and quantity of Frisbees? b. Frisbee manufacturers persuade the government that Frisbee production improves scientists understanding of aerodynamicsand thus is important for national security. Aconcerned Congress votes to impose a pricefloor $2 above the equilibrium price. What isthe new market price? How many Frisbeesare sold?c. Irate college students march on Washingtonand demand a reduction in the price ofFrisbees. An even more concerned Congressvotes to repeal the price floor and impose aprice ceiling $1 below the former price floor.What is the new market price? How manyFrisbees are sold?
Questions & Answers
QUESTION:
A recent study found that the demand and supply schedules for Frisbees are as follows: Price per Quantity Quantity Frisbee Demanded Supplied $11 1 million Frisbees 15 million Frisbees 10 2 12 9 4 9 8 6 6 7 8 3 6 10 1 a. What are the equilibrium price and quantity of Frisbees? b. Frisbee manufacturers persuade the government that Frisbee production improves scientists understanding of aerodynamicsand thus is important for national security. Aconcerned Congress votes to impose a pricefloor $2 above the equilibrium price. What isthe new market price? How many Frisbeesare sold?c. Irate college students march on Washingtonand demand a reduction in the price ofFrisbees. An even more concerned Congressvotes to repeal the price floor and impose aprice ceiling $1 below the former price floor.What is the new market price? How manyFrisbees are sold?
ANSWER:Step 1 of 4
A market, whenever left free, tends to adjust itself to operate at the equilibrium price and quantity unless an external force interferes. Whenever price floors and price ceilings are imposed, only then does the market deviate from the equilibrium point as per the wish of the government.