Suppose that we have 8 people who want to rent an apartment. Their reservation prices are given below. (To keep the numbers small, think of these numbers as being daily rent payments.)

Person: A B C D E F G H

Price: 40 25 30 35 10 18 15 5

a. Plot the market demand curve.

b. Suppose the supply of apartments is fixed at 5 units. In this case there is a whole range of prices that will be equilibrium prices. What is the highest price that would make the demand for apartments equal to 5 units?

c. What is the lowest price that would make the market demand equal to 5 units?

d. With a supply of 4 apartments, which of the people A-H end up getting apartments?

e. What if the supply of apartments increases to 6 units. What is the range of equilibrium prices?