The table shows the demand and supply schedules for milk.
|Price (Dollars per Carton)||Quantity Demanded (Cartons per Day)||Quantity Supplied (Cartons per Day)|
A drought decreases the quantity supplied by 30 cartons a day at each price.
1) At the initial equilibrium price, will there be a shortage or surplus of milk?
2) Will the price of a carton rise or fall?
3) Will the number of cartons demanded increase or decrease as the market moves to the new equilibrium?
The Demand and Supply Schedules:
The Demand Schedule Shows The Association Between The Quantity Demanded And The Price. On The other hand, the supply schedule demonstrates a correlation between the quantity supplied and the price.
Answer and Explanation:
|Price (Dollars per Carton)||Quantity Demanded (Cartons per Day)||Quantity Supplied (Cartons per Day)||New Quantity Supplied (Cartons per Day)|
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from CLEP Social Sciences and History: Study Guide & Test PrepChapter 58 / Lesson 1