Practice Questions 11) Use the following information on the kumquat market in the table to answer the following questionsPrice (per crate) Quantity Demanded (millionsof crates per year)Quantity Supplied (millions of crates per year)10 120 2015 110 6020 100 10025 90 14030 80 18035 70 220a) Calculate equilibrium price and quantity in the market.b) Suppose Federal Government imposes price floor of $30 per crate. Now how many cratesof kumquats will the consumer purchase. Is there any excess demand or supply in the market.2) Use the information on markets for apartments in Bay city int he table to answer the following questionsRent Quantity Demanded Quantity Supplied500 375000 225000600 350000 250000700 325000 275000800 300000 300000900 275000 3250001000 250000 350000a) Find equilibrium rent and equilibrium quantity of apartments rented.b) Now government sets a ceiling on rents of $600 per month. What is the quantity of apartments demanded and supplied.c) Suppose government sets a ceiling on rents of $900 per month. Is the ceiling effective.3) Suppose demand curve is P=20-2.5*Q and supply curve is P=15 + 1.5*Q. Find equilibrium price and quantity.4) In a market system, prices are determined bya. government b. supply and demandc. total market demandd. production costse) All of the above5) According to the law of demand,a. as the price rises, demand will shift to the rightb. as the price rises, demand will shift to the leftc. there is a negative relationship between quantity demanded and priced. there is a positive relationship between quantity demanded and pricee. as the price rises, consumers switch their purchases to complement goods1 Some questions have been inspired by econ.iastate.edu6).Each point along the market demand curve showsa. the relationship between the price of the good and total quantity demanded at a series of pricesb. the quantity of the good that firms would be willing and able to supply at a specific pricec. the quantity of the good that consumers would be willing and able to purchase at a specific priced. how demographic changes affect the quantity demanded at a specific pricee. None of the above7) If automobiles are a normal good and the price of automobiles rises, then holding all else constant, thea. quantity demanded of automobiles will rise b. quantity demanded of automobiles will fallc. demand for automobiles will falld. demand for automobiles will risee. supply of automobiles will
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