Q1.

a) The table below represents the demand and supply conditions for a rice farmer. Complete the table below in the shaded column, identifying the shortage or surplus.(3 marks)

Price in $ per (100kg bag)	Demand (100 kg bags)	Supply (100 kg bags)	Surplus (+); Shortage (-)(100 Kg bags)
100	180	160
200	160	155
300	150	150
400	140	170
500	120	180
600	130	190

b) Based on your findings in the table above, what is the market equilibrium price and quantity for rice?

c) Assume the government increased the price of rice from AUD 300 to AUD 500 per 100kg bag. Examine the factors that can motivate the government to increase the price. Also explain the effects of that government legislation on the rice market.