Question

Table 3-3

Price per Bushel	Quantity Demanded (bushels)	Quantity Supplied (bushels)
$2	40,000	0
4	36,000	4,000
6	30,000	8,000
8	24,000	16,000
10	20,000	20,000
12	18,000	28,000
14	12,000	36,000
16	6,000	40,000

Refer to Table 3-3.  The table contains information about the sorghum market. Use the table to graph the supply and demand curves on the same diagram. Please label the horizontal and vertical axes properly, and clearly label the supply and demand curves.

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Answer 1

The graph can be drawn as follows from the given table.

The curve in red is the demand curve and the curve in blue is the supply curve. The prices are taken on the y-axis and the quantity exchanged on x-axis.

We notice that the market is in equilibrium where the demand curve intersects the supply curve at E* with equilibrium prices $10 per bushel and equilibrium quantity 20,000 bushels.