Changes

4. Why do grocery stores lower the price of their fruit (such as grapes) when they have too many of that fruit and they are on the verge of rotting?  Explain based by citing the downward slope of a demand curve.

4. Why do grocery stores lower the price of their fruit (such as grapes) when they have too many of that fruit and they are on the verge of rotting?  Explain based by citing the downward slope of a demand curve.

5. Suppose 500 persons in a town each have the following weekly demands for gas, and the gas stations have the following weekly supplies:

5. Suppose there is the following supply and demand for Yankees baseball tickets for opening day:

{| class="wikitable"

{| class="wikitable"

|-

|-

|Gallons

|Quantity of Tickets

|Demand Price/Gallon

|Demand Price/Ticket

|Supply Price/Gallon

|Supply Price/Ticket

|-

|-

|10

|10<need to fix this>

|$5

|$5

|$1

|$1

|}

|}

(A) What is the price and overall quantity of gas sold each week?

(A) What is the "free market" or equilibrium price for the bleacher tickets?

<br>(B) Suppose Congress declares war and imposes a price control of $2 per gallon.  At what price and overall quantity will gas sell each week?  Is that desirable?

<br>(B) Suppose the City of New York passes a law for a maximum price (price control) of $<> per bleacher ticket.  What do you think will happen for the price of tickets by scalpers (illegal resales at a different price)?

6.  "Time is money."  Explain.

6.  "Time is money."  Explain.