Figure 5-13

Figure 5-13 illustrates the market for gasoline before the government imposes a tax to bring about the efficient level of gasoline production.
-Refer to Figure 5-13.The market equilibrium price of gasoline is ________ per gallon.

Question

Figure 5-13
  
Figure 5-13 illustrates the market for gasoline before the government imposes a tax to bring about the efficient level of gasoline production.
-Refer to Figure 5-13.The market equilibrium price of gasoline is ________ per gallon.

Quizplus · Accepted Answer

The market equilibrium price of gasoline is where the supply and demand curves intersect, which is at $3.75 per gallon in Figure 5-13. This is where quantity demanded equals quantity supplied, so it represents the market-clearing price.

Figure 5-13 Figure 5-13 Illustrates the Market for Gasoline Before the Government