Use the figure below to answer the following questions. Figure 3.5.1 -If the demand curve is D₂ in Figure 3.5.1, A)the equilibrium price is P₂ and the equilibrium quantity is Q₂. B)the equilibrium price is P₂ and the equilibrium quantity is Q₀. C)there is a shortage in the amount of Q₂ - Q₀. D)a rise in price will shift the demand curve to D₃. E)the price will rise.

Question

Quizplus · Accepted Answer

The equilibrium price is the point where the demand curve intersects with the supply curve. In this case, the demand curve is DS1U1B12S1U1B0 and the supply curve is SS1U1B0. The point where they intersect is at PS1U1B12S1U1B0, and the equilibrium quantity is the corresponding QS1U1B12S1U1B0. Therefore, the answer is A. B is incorrect because the demand curve intersects with the supply curve at QS1U1B12S1U1B0, not QS1U1B10S1U1B0. C is correct but incomplete because it describes the shortage but not the equilibrium price and quantity. D and E may or may not be true, but they are not relevant to the given information about the demand curve.

Use the Figure Below to Answer the Following Questions