Consider the market for straw hats on a tropical island. The demand and supply schedules are given
Question:
a. The equilibrium price for straw hats is ________. The equilibrium quantity demanded and quantity supplied is ________.
b. Suppose the government believes that no islander should have to pay more than $3 for a hat. The government can achieve this by imposing a ________.
c. At the government-controlled price of $3 there will be a of ________ hats ________.
d. Suppose now that the government believes the island's hat makers are not paid enough for their hats and that islanders should pay no less than $6 for a hat. They can achieve this by imposing a ________.
e. At the new government-controlled price of $6 there will be a ________ of ________ hats.
Step by Step Answer:
Microeconomics
ISBN: 978-0321866349
14th canadian Edition
Authors: Christopher T.S. Ragan, Richard G Lipsey