4. a restaurant is selling pizza by the slice. the chart below shows price, the quantity demanded, and…

4. a restaurant is selling pizza by the slice. the chart below shows price, the quantity demanded, and quantity supplied at each price.\n\n| price | quantity demanded | quantity supplied |\n| ---- | ---- | ---- |\n| $11.00 | 0 | 52 |\n| $9.00 | 4 | 44 |\n| $7.00 | 12 | 36 |\n| $5.00 | 24 | 24 |\n| $3.00 | 40 | 12 |\n| $1.00 | 60 | 0 |\n\n5. use the data to plot demand and supply curves.\n\n6. what is equilibrium price?\n7. what is equilibrium quantity?\n8. on your graph, draw a line across at the price of $8.00. assume that the government has stated that pizza slices can cost no more than $8.00. what is the quantity demanded and supplied at this price?\nquantity demanded: \nquantity supplied: \n9. at $8.00 a slice, is there a surplus or shortage of pizza slices? why?

4. a restaurant is selling pizza by the slice. the chart below shows price, the quantity demanded, and quantity supplied at each price.\n\n| price | quantity demanded | quantity supplied |\n| ---- | ---- | ---- |\n| $11.00 | 0 | 52 |\n| $9.00 | 4 | 44 |\n| $7.00 | 12 | 36 |\n| $5.00 | 24 | 24 |\n| $3.00 | 40 | 12 |\n| $1.00 | 60 | 0 |\n\n5. use the data to plot demand and supply curves.\n\n6. what is equilibrium price?\n7. what is equilibrium quantity?\n8. on your graph, draw a line across at the price of $8.00. assume that the government has stated that pizza slices can cost no more than $8.00. what is the quantity demanded and supplied at this price?\nquantity demanded: \nquantity supplied: \n9. at $8.00 a slice, is there a surplus or shortage of pizza slices? why?

Answer

Explanation:

Step1: Identify equilibrium

Equilibrium occurs where quantity demanded equals quantity supplied.

Step2: Find equilibrium price

Looking at the data, when price is $5.00, quantity demanded (12) equals quantity supplied (12).

Step3: Find equilibrium quantity

From the above - mentioned equilibrium, the equilibrium quantity is 12.

Step4: Find quantity at $8.00

Interpolate or look at the trend. At a price of $8.00, quantity demanded is between 4 and 12. Assuming a linear relationship, if we consider the change in quantity demanded with respect to price change, when price changes from $7.00 (quantity demanded 4) to $9.00 (quantity demanded 0), for a $2 change in price, quantity demanded changes by 4. So at $8.00, quantity demanded is 2. Quantity supplied at $8.00 is between 36 and 44. Assuming linearity, it is 40.

Step5: Determine surplus or shortage

Since quantity supplied (40) is greater than quantity demanded (2) at a price of $8.00, there is a surplus.

Answer:

  1. $5.00
  2. 12
  3. Quantity Demanded: 2 Quantity Supplied: 40
  4. There is a surplus because quantity supplied (40) is greater than quantity demanded (2) at a price of $8.00.