(6a)Plot the demand and supply curves for gasoline consumption in the state of New York given the following hypothetical annual data:
Data for annual gasoline demand:
Data for annual gasoline supply:
(Qs =.3m liters, P=$0.85)
(6b)What is the market equilibrium price and market equilibrium quantity in the diagram above?
(6c)Why is the market equilibrium point in the market for gasoline in the state of New York in (6b) above unique?
(6d)Identify the unit prices for gasoline that trigger disequilibria positions in this market
(6e)What is the relationship between the law of demand and law of supply and the prices at, above and below the equilibrium position in the market for gasoline in (6c) and (6d) above?
(6f)Does the existence of equilibrium in the gasoline market in (6c) above mean that all participants in the market are satisfied? Why or Why no6
(6g)What would be the effect of a binding price ceiling in the market for gasoline in the state of New York? Explain the rationale for your answer?
(6h)How would the imposition of a binding price floor by the government of New York change your answer from that given in (6g) above?
Unlock access to this and over
10,000 step-by-step explanations
Have an account? Log In