1. Assume the following: a. The supply schedule is given from P = 2 + 3Qs b.The demand schedule is given from P= 10 - Qd Find the equilibrium price and the equilibrium quantity. Draw a diagram to account for equilibrium price, equilibrium quantity, slope, etc.
2. Evaluate the following statements using graphical analysis. Provide a brief narrative explanation of your graph to support your evaluation. Make sure the axes and curves in your graphs are properly labeled.
a. “When demand for home heating oil increases, a shortage of heating oil will occur.”
b. “A decrease in the supply of random access memory (RAM) chips for personal computers causes a shortage of RAM chips.”