1 Draw In the market for widgets, supply and demand are estimated as follows: P = 20 LSQd and P = 2 + (2;. Graph these curves [be sure to label axes and curves) and solve for the equilibrium price and quantity. 25A 20 15 10 5 10 15 20 2-5 F": . Cr: _ 2 A Long December rThis winter is hotter than normal, so people want fewer wool scarves than before...however, a new break through in genetic engineering caused many sheep to grow hair (used to make wool) much faster this year. Show what happens in the market for wool. In the left graph, show a big change in D and small change in S. In the right graph, show a small change in D and a big change in S. Please indicate what happens to price and quantity relative to the initial equilibrium. Either price or quantity will be ambiguous in each instance, so each question will have 2 possible graphs. Draw them both. BE SURE TO LABEL axes and CUIVES . P ,Q P,Q 1Which change is ambiguous, price or quantity? What happens to the other one?. 3 Ceiling's the Limit Graph a binding price ceiling. Be sure to label everything necessary for someone to know that. this is a binding price ceiling. 4 thltiple Choice If a surplus of a good exists at the current price, how will the market respond? a) the price will fall since demand and supplyr both decrease b) the price will fall while quantity demanded increases and the quantity supplied falls c) the price will rise since demand and supply;r both increase d) the price will rise while the quantity demanded decreases and the quantity supplied increases