Question

From the given data Price
10 20 30 40 50
Quantity Demanded 500
400 300 200 100
Quantity Supplied 100
200 300 400 500
a. Find the equilibrium quantity and price. Also, illustrate it on the graph. b. Identify when the market is in disequilibrium where demand exceeds supply. Also, illustrate it on the graph.
c. Identify when the market is in disequilibrium where supply exceeds demand. Also, illustrate it on the graph.
d. If the government imposes a price ceiling of Rs. 20. Explain what would happen to equilibrium.
e. If the government imposes a price ceiling of Rs. 40. Explain what would happen to equilibrium.​

Answer 1

Answer:

Here, E is the equilibrium point.

Explanation:

(a)Because in here quantity of demand(300) is equal to quantity of supply(300).

(b) It is below the point E(equilibrium), when price level decreases than Rs.30 then demand will exceeds supply.

(c) When price will increase than Rs.30, at that time supply exceeds demand.