Answer to Question #144131 in Economics for Sukhvinder

Question

Price of Basket balls: AED2,4,6,8,10

QD: 10, 8, 6,4,2

QS: 2,4,6,8,10

If our products hit the market for sale at AED 4, what market situation will be present? what is the size of shortage/surplus?

B. If price of basketball increases to AED8, what market situation will be present? explain in detail.

Answer 1

A. If our products hit the market for sale at AED 4, then the shortage of 8 - 4 = 4 balls will be present.

B. If price of basketball increases to AED8, then the surplus of 8 - 4 = 4 balls will be present.