Question

Back to open Attempts: 2235 Average: 2.874 2. Price controls in the Florida orange market The following graph shows the annual market for Florida oranges, which are sold in units of 90-pound boxes Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graphs Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly, Graph Input Tool Market for Florida Oranges (Dollars per bow) Quantity Demanded (Millions of bones Quantity Supplied PRICE (Dollars per box) 140 210 20 30 420 499 60 630 700 QUANTITY (Mlions of boxes) In this market. the equilibrium price is $ per box, and the equilibrium quantity of oranges is million boxes.

for the last fill in the blank the first blank is (surplus,shortgage) second blank is (larger,smaller)

thanks!

Answer 1

At equilibrium demand curve intersects the supply curve.

In this market, the equilibrium price is $25 per box and the equilibrium quantity of oranges is 350 million boxes.

If demand > supply ----> shortage in the market ----> Upward pressure on price.

If demand < supply ----> surplus in the market ----> Downward pressure on price.

Price ($ per box)	Quantity demanded (million of boxes)	Quantity supplied (millions of boxes)	Pressure on price
15	406	294	Upward
35	294	406	Downward

Note: Please use the "Graph Input Tool" to get the correct values of quantity demand and quantity supply in the above table.

A price ceiling is effective (binding) if it is set below the equilibrium price.

An effective price ceiling creates a shortage in the market.

FALSE: A price ceiling below $25 per box is not a binding price ceiling in the market.

Assuming that the long-run demand for oranges is the same as the short-run demand, you would expect a binding price ceiling to result in a shortage that is larger in the long run than the short run.

because the long-run supply curve is more price-sensitive than the short-run supply curve.