The market supply of lettuce in a small town is shown in the table below. Market Supply of Lettuce $3 .00 2.50 2.00 1.50 1.00 0. 50 Price (dollars) Quantity of Lettuce Supplied (heads) Init iaI 350 310 270 230 190 150 Instructions: Enter your answers as a whole number. a. Suppose there is a decrease in the cost of renting land that allows lettuce growers to produce 50 more heads of lettuce at each price. Find the new quantities supplied at each price, and then complete the new supply schedule in the table. b. At a price of $1.00 per head of lettuce, the original quantity supplied was heads of lettuce. heads of lettuce and the new quantity supplied is
Answer:
Q1: New supply schedule — Prices and new quantities supplied:
$3.00 → 400
$2.50 → 360
$2.00 → 320
$1.50 → 280
$1.00 → 240
$0.50 → 200
Q2: At price $1.00 the original quantity supplied was 190 heads and the new quantity supplied is 240 heads.
Explanation:
Steps:
- A decrease in land-renting cost raises supply by 50 heads at each price, so add 50 to each original quantity.
- For example \(190 + 50 = 240\) at the $1.00 price; do similarly for the other prices.
