Question

Qd Price Qs -300-10.53l00-50 -310 =815-40 $5 8" 10-80 F360-10-10-3le0-100 260 $10 3le0- 10 15-2l0-150-210 84 15 -120 $15 8*20: lo0 $20 3H00-10-20 300-20016o F3406-10.25-3o-250-1108 25 200 $25 $30 = 3 66-10-30-30-3000 8 30 240 THE EQUILIDIum peicE IS 20 AnD Equilibriumis 1loo. b) Graph the supply and demand curves for t-shirts. Label the equilibrium price and quantity. c) Dominican administration thinks it is unfair to charge a price over $10 for t-shirts. Will there be a surplus or shortage at this price? By how much? Show this on your graph. d) The Dominican basketball team has an outstanding season, culminating in a conference championship. People are clamoring for more DU shirts to show their pride. What will this change in preferences do to the demand curve? Show this on your graph.

I need questions b,c and d. Thank you.

Answer 1

b) The required graph is below DD-SS 35 30 25 Е 20 15 10 Shortage 50 100 150 200 250 300 350 QD QS Equilibrium occurs at point E where P $20 and Q 160 c) since $10 is below the free market equilibrium price, at this price Quantity demanded would exceed quantity supplied, leading to a situation of shortage in the economy Shortage QD - QS 260-80 180 units d) This will shift the demand curve to the right to D", leading to an increase in both price and quantity sold, as seen below: DD-SS 35 30 25 20 15 10 5 300 0 50 100 150 200 250 350 QD un