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The widget industry is perfectly competitive. The industry demand and supply functions for widgets are given below.
Qd = 424 - 40P
Qs = 40 + 8P
a. What is the equilibrium price and quantity for the industry?
b. If the government establishes a price floor of $9, explain what will result in terms of excess demand or supply.
c. If the government establishes a price ceiling of $6, explain what will result in terms of excess demand or supply.
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Cash $10,000 Accounts Payable $7,000 Accounts Receivable $6,400 Mortgage Payable $65,000 Supplies $1,500 Long-term Debt $36,000 Building $150,000 Notes Payable $9,000 Equip
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