Price: 4,8,12,16,20 Quantity Demanded:10,000, 8000,6000,4000,2000 Quantity Suppl

Question

Price: 4,8,12,16,20
Quantity Demanded:10,000, 8000,6000,4000,2000
Quantity Supplied: 8000,8000,8000,8000,8000

a. Draw the demand and supply curves. What is unusual about the supply curve ? Why might this be true?
b. What are the equilibrium price and quantity of tickets?
c. Your college plans to increase total enrollment next year by 5,000 students. The additional students will have the following demand schedule:

Price:4,8,12,16,20
Quantity Demanded: 4000,3000,2000,1000,0

Now add the old demand schedule and the demand schedule for the new students to calculate the ew demand scedhule for the entire college. Wha will be the new equilibrium price and quantity.
I'm very confused, becasue the way the supply is the new demand does not touch the supply curve. So I ca't find out the new equilibiurm. Please help me.

Explanation / Answer

A. The supply curve is unusual because it is horizontal, or perfectly inelastic. No matter how much change in price, there is no change in supply. This is probably because there is no cost to producing tickets, they want to sell all of them no matter what price. B. A price of 8$, both quantity supply and quantity demand are 8000 at this point. C. The new demand curve should be Price: 4, 8, 12, 16, 20 Quantity Demanded: 14000, 11000, 8000, 5000, 2000 So the equilibrium price would be 12$, where the new demand curve intersects the original supply curve.

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.