I just need clarification on Question #7 What impact is this policy expected to have in the retail market of sanitizing wipes? I am unsure if I answer question 7 correctly.
The retail market for sanitizing wipes in a small locale is described by the following demand and supply equations: P = 8.40 - 0.02Q + P = 6.60 + 0.010 where price is in dollars and quantity is measured in thousands per week. 1. What is the current market outcome as described by the equilibrium price and quantity? (6 points) Complete the sentence by entering a numerical value (0.0o is acceptable) in each of the blank spaces provided. Currently, the equilibrium price is $ 7.20 and the equilibrium quantity is 60 thousand per week. Consider that an unexpected viral outbreak led to consumers ensuring that much more surfaces (counter tops, door handles, etc.) are clean and sanitized. At the same time, the government's demand for sanitizing wipes at various public institutions (hospitals, schools, etc.) has impacted the supply of sanitizing wipes in the retail market. Although the government is neither a buyer nor a seller in the retail market, their requests for sanitizing wipes does affect how many sanitizing wipes firms are able to supply in the retail market. The retail market for sanitizing wipes adjusts after the unexpected viral outbreak. 2. Given the impact of the unexpected viral outbreak, what changes are expected in the retail market for sanitizing wipes? (4 points) Complete the sentence below by entering one of the following phrases in the blank spaces provided (phrases may be repeated): in the each blank space: change ambiguously | decrease | increase | not change One would expect demand to increase and supply to change ambiguously As a result (and without additional information), the equilibrium price is expected to increase and the equilibrium quantity is expected to increase Suppose that after the retail market for sanitizing wipes adjusts, the market equations are determined. 3. Which of the following equations, Equation A or Equation B, represents the demand for sanitizing wipes in the retail market after the adjustment? (2 points) Equation A: P = 8.40 - 0.02Q + Equation B: P = 12.60 - 0.020 where price is in dollars and quantity is measured in thousands per week. Complete the sentence below by entering one of the following phrases in the blank space provided: in the first blank space: A | B After the adjustment in the retail market, the demand for sanitizing is represented by Equation A4. Which of the following equations, Equation Cor Equation D, represents the supply for sanitizing wipes in the retail market after the adjustment? (2 points) Equation C: P = 6.60 + 0.01Q + Equation D: P = 8.10 + 0.01Q where price is in dollars and quantity is measured in thousands per week. Complete the sentence below by entering one of the following phrases in the blank space provided: in the first blank space: C | D After the adjustment in the retail market, the supply for sanitizing is represented by Equation D 5. What is the new market outcome as described by the equilibrium price and quantity? (4 points) Complete the sentence by entering a numerical value (0.0o is acceptable) in each of the blank spaces provided. After the adjustment in the retail market, the new equilibrium price is $ 7.20 and the equilibrium quantity is 60 thousand per week. Aware of the changes in the retail market for sanitizing wipes, the government decides to implement a price control of $7.20 in the market. 6. What type of government policy is this? (2 points) Complete the sentence below by entering one of the following phrases in the blank space provided: in the each blank space: quota | price ceiling | price floor | subsidy | tax This government policy is a price floor in the retail market for sanitizing wipes.7. What impact is this policy expected to have in the retail market of sanitizing wipes? (6 points) Complete the sentences below by entering one of the following phrases in the blank spaces provided (phrases may be repeated): in the first blank space: equilibrium | disequilibrium in the second blank space: equal to $7.20 | greater than $7.20 | less than $7.20 in the third blank space: equal to the quantity supplied | greater than the quantity supplied | less than the quantity supplied in the fourth blank space: the market clears | there will be a shortage in the market | there will be a surplus in the market in the fifth blank space: buyers | buyers and sellers | sellers in the sixth blank space: buy sanitizing wipes in an illegal market | not change the amount of sanitizing wipes being traded (bought and sold) | sell sanitizing wipes in an illegal market After the implementation of this government policy, one would expect the market to be in disequilibrium The market price is expected to be equal to $7.20 and the quantity demanded to be greater than the quantity s . As a result, the market clears and buyers may seek to buy sanitizing wipes in an il
