Refer to the table below containing the market demand and supply schedules for leather jackets.

Price

($ per jacket)Quantity Demanded

(jackets per year)Quantity Supplied

(jackets per year)$4006,0009,0003507,0007,0003008,0005,0002509,0003,00020010,0001,000

a. Draw a graph showing the market demand and supply curves, D and S₀, and the associated equilibrium point.Use the line tools provided to plot only the 2 endpoints of each curve. Indicate each equilibrium point with the tool provided.

b. The equilibrium price is $and the equilibrium quantity isjackets.

c. Due to an increase in the number of producers, the annual quantity supplied in this market increases by 6,000 jackets at every price.

The new equilibrium price is $and the new equilibrium quantity isjackets.

d.Draw the new market supply curve (S₁) and indicate the new equilibrium on the graph above.Plot only the 2 endpoints to draw the curve and 1 point to indicate the new equilibrium in the graph above.

e. Due to the change in supply conditions, sellers' total revenue will change.When compared with the initial equilibrium price and quantity, sellers' total revenue

(Click to select)

rises

falls

from $million to $million. Because price and total revenue move in the

(Click to select)

opposite

same

direction(s), demand is

(Click to select)

unit-elastic

elastic

inelastic

in this price range.

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