EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 20, Problem 3DQ
Subpart (a):
To determine
The problems in the agricultural sector.
Subpart (b):
To determine
The impact of the technological progress in the agricultural sector.
Subpart (c):
To determine
What resulted in the downward trend in agricultural income.
Subpart (d):
To determine
The adjustments in the price and supply of agricultural output.
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Students have asked these similar questions
3. Refer to the expanded table below from review question 8.
LO3.4
a. What is the equilibrium price? At what price is there nei-
ther a shortage nor a surplus? Fill in the surplus-shortage
column and use it to confirm your answers.
b. Graph the demand for wheat and the supply of wheat. Be
sure to label the axes of your graph correctly. Label equi-
librium price Pand equilibrium quantity Q.
c. How big is the surplus or shortage at $3.40? At $4.90?
How big a surplus or shortage results if the price is 60
cents higher than the equilibrium price? 30 cents lower
than the equilibrium price?
Thousands
of Bushels
Surplus (+)
or
Shortage (-)
Thousands
Price per
Bushel
of Bushels
Supplied
Demanded
85
$3.40
72
80
3.70
73
75
4.00
75
70
4.30
77
65
4.60
79
60
4.90
81
Price
$12
$10
$8
$6
$4
$2
Table 3
D1
LO
5
8
11
13
16
18
D2
O a 15 unit surplus will result..
O a 10 unit shortage will result.
O a 15 unit shortage will result.
O a 10 unit surplus will result.
9
12
15
18
21
24
S₁
19
17
15
13
11
9
S2
14
12
10
8
6
4
Suppose that D2 and S2 are the demand and supply schedules for
Product A. If the government imposes a price ceiling of $4, then:
Question 3
Table: U.S. Demand for and Supply of Widgets
Price
$1
Quantity 5
Supplied
Quantity
Demanded
20
O 0 widgets
2 widgets
O4 widgets
6 widgets
$2
6
19
$3
7
18
$4
8
17
$5
9
15
$6
10
14
$7
11
13
$8 $9
12 13
12
11
$10
14
10
The United States can import widgets from China at $4 each and from Mexico at $5 each. The United States
imposes a tariff of $2 on each of its widget imports. Suppose that the United States and Mexico form a free-
trade area. How much trade in widgets is diverted in the U.S.-Mexican free-trade area?
Chapter 20 Solutions
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