Refer to Table 3-6. The table contains information about the sorghum market. Use the table to answer the following questions
a. What are the equilibrium price and quantity of sorghum?
b. Suppose the prevailing price is $6 per bushel. Is there a shortage or a surplus in the market?
c. What is the quantity of the shortage or surplus?
d. How many bushels will be sold if the market price is $6 per bushel?
e. If the market price is $6 per bushel, what must happen to restore equilibrium in the market?
f. At what price will suppliers be able to sell 36,000 bushels of sorghum?
g. Suppose the market price is $14 per bushel. Is there a shortage or a surplus in the market?
h. What is the quantity of the shortage or surplus?
i. How many bushels will be sold if the market price is $14 per bushel?
j. If the market price is $14 per bushel, what must happen to restore equilibrium in the market?
a. Equilibrium price = $10; Equilibrium quantity = 20,000 bushels.
b. There is a shortage.
c. Shortage = 30,000 - 8,000 = 22,000 bushels.
d. Quantity sold = 8,000 bushels.
e. Price must rise.
f. At $4 per bushel.
g. There is a surplus.
h. Surplus = 36,000 - 12,000 = 24,000 bushels.
i. Quantity sold = 12,000 bushels.
j. Price must fall.
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