Figure 9.4.3
-Refer to Figure 9.4.3 above. After the policy was implemented, price became:
A) $10.
B) $30.
C) $50.
D) $70.
E) between $50 and $70, but the price is uncertain because quantity can be any amount between 2000 and 4000.

Question

Figure 9.4.3
-Refer to Figure 9.4.3 above. After the policy was implemented, price became:
A) $10. 
B) $30. 
C) $50. 
D) $70. 
E) between $50 and $70, but the price is uncertain because quantity can be any amount between 2000 and 4000.

Quizplus · Accepted Answer

After the policy was implemented, the supply curve shifted to the left from S1 to S2. As a result, the equilibrium point moved from point A to point B, causing both the price and quantity to increase. The new equilibrium point is where the demand curve intersects with the new supply curve, which is at a price of $50. Therefore, the price became $50 after the policy was implemented.

Figure 9.4.3 -Refer to Figure 9.4.3 Above. After the Policy Was Implemented