assume the figure illustrates the market for houses for sale in a small city. suppose the market price of…

assume the figure illustrates the market for houses for sale in a small city. suppose the market price of houses is $225,000. how large will the resulting surplus be? at a price of $225,000, there will be surplus houses. (enter your response as a whole number.) what is the equilibrium price of houses? the equilibrium price is $ (enter your response as a whole number.)

assume the figure illustrates the market for houses for sale in a small city. suppose the market price of houses is $225,000. how large will the resulting surplus be? at a price of $225,000, there will be surplus houses. (enter your response as a whole number.) what is the equilibrium price of houses? the equilibrium price is $ (enter your response as a whole number.)

Answer

Explanation:

Step1: Find quantity supplied and demanded at $225,000

At price = $225,000, read from the graph. Quantity supplied ($Q_s$) is 1000 and quantity demanded ($Q_d$) is 400.

Step2: Calculate surplus

Surplus = $Q_s - Q_d$. So, Surplus = $1000 - 400=600$.

Step3: Find equilibrium price

Equilibrium occurs where supply and demand curves intersect. From the graph, equilibrium price is at the intersection point, which is $150,000$.

Answer:

At a price of $225,000, there will be 600 surplus houses. The equilibrium price is $150000$.