T1 Wk 7 - Equilibrium in D/S

At a price of $25, this market has a

• Surplus of 300

• Shortage of 300

• Equilibrium of 600

• Total Revenue of $20,000

At a price of $15, this market has a

• Surplus of 300

• Shortage of 300

• Equilibrium of 600

• Total Revenue of $6,000

If prices rise from $20 to $25, explain what happens to quantity demanded

• Demand Decreases

• Shortage of 300

• Demand contracts from 600 to 500

• Demand expands from 600 to 500

If prices rise from $20 to $25, explain what happens to quantity demanded

• Demand Decreases

• Shortage of 300

• Demand contracts from 600 to 500 and a surplus is created

• Demand expands from 600 to 500 and a shortage is created

If prices fall from $20 to $10, explain what happens to demand and supply

• Demand Increases and Supply Decreases

• Demand Expands and Supply Contracts

• Demand Contracts and Supply Expands

• Demand Decreases and Supply Increases