Use this link to access approaite figure: http://www.youtube.com/watch?v=RwKi1J_

Question

Use this link to access approaite figure: http://www.youtube.com/watch?v=RwKi1J_fG4E

This a multiple choice question, pick one answer (A-E)

Please explain why you pick an answer

5. The figure above shows the demand for Restaurant Meals shifting in one direction and the demand for Delivery Meals shifting in another direction. If, in the Delivery Market, the price remained at $10 but demand was D2 what would occur?
A) People would be willing and able to purchase 60 but would have a choice from among 75.
B) People would be willing and able to purchase 75 but could only get 60.
C) People would be willing and able to purchase 75 but could only get 50.
D) People would be willing and able to purchase more than 75 but could only get 50.
E) People would be willing and able to purchase 50, and producers would supply only 50.

Explanation / Answer

The correct answer is D) People would be willing and able to purchase more than 75 but could only get 50. At a price of $10, the demand is 75, but the supply is only 50. So, with a demand of D2, this must not be the equilibrium.

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