4. Use the graph below to answer the questions that follow. Be sru'e to show your calculations. (16 marks) $14 Supply '12 ' --------------------------------------------------- 510 $3' $6 $4 $2 $0 1 0 4 3 12 16 20 24 2! a. What would the equilibrium price and quantity be? b. Suppose the price is currently at $4. What problem would exist in the economy? What would you expect to happen to price? Explain your answer. c. Suppose the price is currently $12. W'hat problem exists in the economy? What would you expect to happen to price? Explain your answer. d. What is the slope of the demand curve between point E and point C? e. Using the midpoint method, calculate the elasticity of demand if price changes from $12 to $8. Is this elastic or inelastic? f. Using the midpoint method, calculate the elasticity of supply if price changes from $8 to $12. 15 this elastic or inelastic? g. Explain the effect a $12 price floor would have on this market. Would this be a binding price oor? h. Why would policymakers choose to impose a price ceiling or price oor