Table 3.8 shows information on the demand and supply for...

Table 3.8 shows information on the demand and supply for bicycles, where the quantities of bicycles are measured in thousands. a. What is the quantity demanded and the quantity supplied at a price of 210 dollar? b. At what price is the quantity supplied equal to 48,000 dollar? c. Graph the demand and supply curve for bicycles. How can you determine the equilibrium price and quantity from the graph? How can you determine the equilibrium price and quantity from the table? What are the equilibrium price and equilibrium quantity? d. If the price was 120 dollar, what would the quantities demanded and supplied be? Would a shortage or surplus exist? If so, how large would the shortage or surplus be?

Table 3.8 shows information on the demand and supply for bicycles, where the quantities of bicycles are measured in thousands.
a. What is the quantity demanded and the quantity supplied at a price of 210 dollar?
b. At what price is the quantity supplied equal to 48,000 dollar?
c. Graph the demand and supply curve for bicycles. How can you determine the equilibrium price and quantity from the graph? How can you determine the equilibrium price and quantity from the table? What are the equilibrium price and equilibrium quantity?
d. If the price was 120 dollar, what would the quantities demanded and supplied be? Would a shortage or surplus exist? If so, how large would the shortage or surplus be?

Key Concepts

Graphical Analysis of Supply and Demand

Graphing the demand and supply curves provides a visual method to analyze market behavior. The intersection point of these curves identifies the equilibrium price and quantity. Additionally, the graph can clearly illustrate situations of shortage (when the demand curve is above the supply curve at a particular price) and surplus (when the supply curve is above the demand curve), providing insights into market imbalances.

Shortage and Surplus

A shortage occurs when the quantity demanded exceeds the quantity supplied at a given price, leading to upward pressure on prices. Conversely, a surplus arises when the quantity supplied is greater than the quantity demanded at a given price, prompting downward pressure on prices until the market reaches equilibrium.

Equilibrium Quantity

This is the quantity of the good that is bought and sold at the equilibrium price. It reflects the point at which the supply and demand curves intersect, representing a stable market condition where the interests of both buyers and sellers are balanced.

Equilibrium Price

The equilibrium price is the market price at which the quantity demanded by consumers equals the quantity supplied by producers. It represents the state of balance in the market where there is neither a surplus nor a shortage of the good.

Supply

Supply describes the relationship between the price of a good and the quantity producers are willing to offer for sale. The supply schedule or curve shows how quantity supplied changes with price, indicating how producers react to price signals in terms of production levels.

Demand

This concept refers to the relationship between the price of a good and the quantity consumers are willing to purchase at each price level. It is typically represented by a demand schedule or curve that shows how quantity demanded varies as the price changes, reflecting consumer preferences and purchasing behavior.

Transcript

00:01 Hello guys and welcome.

00:01 Let's start by solving the question.

00:03 I placed the given previously so that it would be easier for you.

00:07 Let's start by question a.

00:09 Table 3 .8 chose information on the demand and supply for bicycle where the quantity of bicycle are measured in 1000.

00:19 A.

00:19 What is the quantity demanded and the quantity supplied at the price of $200? for quantity demanded, as you can see, it is 28 and as for quantity supplied, it is 56.

00:33 Now, let's move to the question b.

00:37 It says, at what price is the quantity supplied equal to $48 ,000? as you can see, one price equaled $180 .00.

00:51 Now, in question c, they asked us to graph the demand and supply curve for a bicycle.

00:59 Okay? then we will complete the whole question.

01:03 First of all, i'm drawing the x -axis, y -axis.

01:07 On the y -axis, we have the price.

01:09 On the x -axis, we have the quantity.

01:12 Let's place the prices.

01:14 We have 120, 150, 150, 180.

01:19 Also, we have 210, and finally, we have 240.

01:26 And 40.

01:28 Now as for quantities, i'm not using a proper scale.