MINDTAP Homework Ch 04 Graph Input Tool Market for Shirts Th

MINDTAP Homework (Ch 04) Graph Input Tool Market for Shirts The euaantum price in this market is -per shit, and the equatrum-tr i, shits bought and sold per month. per shirt, and the equllbrium quantity is shirts bought and sold per month Compiete the folowing table by indicating at each price whether there is a shertage or surplus in the market, the amount of that shortape or surplus and whether this places upward or downward pressure on prices Shortage or Surplas Amount (Sirts) (Dollars per shirt) Shortage or Surplus

Solution

Market equilibrium price for this market is 30 dollars and the quantity in the market is 500 shirts.

When price is 42 dollars, quantity demanded is 0 shirts and quantity supplied is 580 shirts. There is a surplus in the market. This surplus is equal to 580 shirts. Hence there is a downward pressure on the price.

When price is 18 dollars, quantity demanded is 1000 shirts and quantity supplied is 420 shirts. There is a shortage in the market. This shortage is equal to 580 shirts. Hence there is a upward pressure on the price.