Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

c . Note that we haven't given you the original market price of simple bicycles - why don't you need to know it ? (

c. Note that we haven't given you the original market price of simple bicycles-why don't you need to know it?(Hint: The answer is a mix of geometry and economics.)
It's unnecessary because the
equilibrium price can be calculated from the graph. Since the price-controlled quantity is one-half of the equilibrium quantity, we can infer that the consumers' price at the price-controlled quantity, $80, is one-half of the equilibrium price, which is then $40.
calculations require the quantity supplied at the controlled price, the price consumers are willing to pay and the price producers are willing to accept for that quantity supplied, and the equilibrium quantity, but not the equilibrium price. equilibrium price is the average of the consumers' willingness to pay and the producers' willingness to accept values at the price-controlled quantity: the average of $80 and $30 is $55.
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Economics questions

Question

What is meant by Career Planning and development ?

Answered: 1 week ago

Question

What are Fringe Benefits ? List out some.

Answered: 1 week ago