Answer to Question #260884 in Microeconomics for Abbey

Question

a) Think of a product produced in Belize (market price would be less than $50). Set up a demand and supply schedule of your own for that product.

b) Use the data in the demand and supply schedule to create a demand curve and a supply curve for the product. Please label the diagram completely.

c) Define “Equilibrium.” Explain what is the equilibrium price for your product and explain how you arrived at that equilibrium price.

Answer 1

a) demand schedule for bananas in Belize

b) demand curve

Supply curve

c)

Equilibrium is the point in the market where supply and demand balance each other.

In my example the equilibrium price is 6.