Question

The table below presents the average monthly demand and supply of 4' x 8' sheets of plywood from a typical home building supply store. In any month when coastal states such as Florida are threatened by hurricanes, the typical monthly demand for plywood increases by 600 sheets at every price. Imagine Florida passes a "price gouging" law that prevents home building supply stores from raising the price of plywood when hurricanes threaten Market for Plywood Initial Quantity of Quantity of New Quantity Plywood Supplied (sheets) 3,600 Initial Plywood Demanded of Plywood Demanded (sheets) 6,300 Price (dollars) $10 (sheets) 5,700 6,200 6,100 5,600 3,800 12 5,500 4,000 4,200 4,400 13 5,400 6,000 5,300 5,200 5,100 5, 800 5,700 15 4,600 16 4,800 5,000 5,200 5,400 ,600 17 5,000 5,600 4,900 4,800 5,500 5,400 5,300 19 20 4,700 21 5,800 5,200 4,600 Instructions: Enter your answers as a whole number a. When there are no hurricanes threatening Florida, and without the "price gouging" law in place, what are the equilibrium price and quantity in the plywood market? 17 Q = [ ] sheets b. When hurricanes threaten Florida, and without the "price gouging" law in place, what are the equilibrium price and quantity in the plywood market? 19 Q sheets c. When hurricanes threaten Florida, and with the "price gouging" law in place, what are the equilibrium price of plywood, the quantity demanded of plywood, and the quantity supplied of plywood? ] sheets Qd Og-D sheets

Answer 1

biz Hence 13 54us hech (Trade rum Shee

Answer 2

A. P = $17 , Q=5,000 sheets

B. P=$19, Q=5,400 sheets

C. P=$17, Qd= 5,600 sheets, Qs= 5,000 sheets

D. to create a shortage of 600 sheets of plywood.