Exhibit 4-10 Supply and Demand Data for Apricots -In Exhibit 4-10, Assume That the Government Initially Sets a |

question 252

Multiple Choice

Exhibit 4-10 Supply and demand data for apricots $$\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Bushels demanded } \\\text { per month }\end{array} & \begin{array} { c } \text { Price per } \\\text { bushel }\end{array} & \begin{array} { c } \text { Bushels supplied } \\\text { per month }\end{array} \\\hline 50 & \$ 5 & 80 \\55 & 4 & 75 \\60 & 3 & 70 \\65 & 2 & 65 \\70 & 1 & 55 \\\hline\end{array}$$
-In Exhibit 4-10, assume that the government initially sets a price floor of $4 for apricots, and then removes the $4 price floor. What effect will this price change have?

• A) The price of apricots will rise.
• B) The quantity of apricots demanded will fall.
• C) The quantity of apricots supplied will decline.
• D) Quantity supplied will continue to exceed quantity demanded.

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Definitions:

Quantity Supplied

The amount of a good that producers are willing to sell at a given price over a specified period.

Quantity Demanded

The amount of a good or service consumers are willing and able to purchase at a given price.

Price

The cost at which a product or service is offered for sale in the marketplace.

Market Demand Curve

A graphical representation of the quantity of goods being purchased at different prices within a market.