Assignment | The same as the quantity that consumers are willing and ready to purchase.

Running head: ECONOMICS 1
Principles of Economics
Student Name
Institution

ECONOMICS 2
Principles of Economics
Part A
Demand and Supply Curve
From the supply and demand curve above, the price at the equilibrium point occurs where
the quantity that suppliers are willing and ready to supply to the market is the same as the
quantity that consumers are willing and ready to purchase. Therefore, it is a point where the two
curves intersect in the market. On the other hand, the equilibrium quantity is instantaneously
equal to both the quantity demanded and quantity supplied. From the above graph, the point
where the supply curve intersects with the supply curve denotes equilibrium. Hence, from the
above graph, the equilibrium quantity and price are 600 and 1.4 respectively.
Based on the above graph, when the price of gasoline per gallon is $ 1.6, then the
quantity demanded will be lower than the equilibrium price. At $ 1.6, the quantity that the
customers demand is 500, which is below the equilibrium. This phenomenon is due to the fact
that price and quantity demanded are inversely related; therefore, when the price increase, the
400 450 500 550 600 650 700 750 800
0
0.5
1
1.5
2
2.5
Demand 750 650 600 500 500 470 440 Supply