1 . Price controls in the Florida orange market The following graph shows the annual market for Florida oranges, which are sold in units onUpound boxes. Use the graph input tool to help you answer the following questions. YOU will not be graded on any changes you make to this graph. Note: Once you enter a value in a white eld, the graph and any corresponding amounts in each grey eld will change accordingly. Graph Input Tool 6*) Market for Flon'da Oranges so 45 - I Price 40 (Dollars per box) E r. Quant' Quantity Supplied E 35 Deman ed 900' [' Millions of boxes) 3?!!- ._ ( Millions of boxes) CD a an EU 25 E Q 24:: E E 15 EL 10 5 o o 901302703604505443630720310900 QUANTITY (Millions of boxes} In this market, the equilibrium price is $ per box, and the equilibrium quantity of oranges is million boxes. For each of the prices listed in the following table, determine the quantity of oranges demanded, the quantity of oranges supplied, and the direction of pressure exerted on prices in the absence of any price controls. Price Quantity Demanded Quantity Supplied ( Dollars per box) (Millions of boxes J (Millions of boxes J Pressu re on Prices 15 I: :l _v 35 I: :| True or False: A price ceiling below $25 per box is a binding price ceiling in this market. v 0 True 0 False Because it takes many years before newly planted orange trees bear fruit, the supply curve in the short run is almost vertical. In the long run, farmers can decide whether to plant oranges on their land, to plant something else, or to sell their land altogether. Therefore, the long-run supply of oranges is much more price sensitive than the shortrun supply of oranges. Assuming that the longrun demand for oranges is the same as the shortrun demand. you would expect a binding price ceiling to result in a V that is V in the long run than in the short run