Refer to the following supply and demand schedules for the market for yo-yos.
Price Qd Qs
$1 100 10
$2 80 35
$3 60 60
$4 40 85
$5 20 110
What are the equilibrium price and quantity of yo-yos? Explain your answer, and show your work.
If price in the market is $2, will there be a surplus or shortage of yo-yos and how large will the surplus/shortage be? Explain your answer, and show your work.
If price is $2, will price tend to increase, decrease, or stay the same over time?
If the price in the market is $5, will there be a surplus or shortage of yo-yos and how large will the surplus/shortage be? Explain your answer, and show your work.
If price is $5, will it tend to increase, decrease, or stay the same over time?
