Question

An electronics store sells speciality headphones for $100. They usually sell 5 pairs per day and purchase 150 pairs from their suppliers per month.

According to the law of supply, which out would be most likely of the store could sell the headphones for $120 without losing customers?

Answer 1

According to the law of supply, if the electronics store could sell the headphones for $120 without losing customers, there would be a surplus of 145 pairs of headphones per month.

Step-by-step explanation:

According to the law of supply, if the electronics store could sell the headphones for $120 without losing customers, there would be a surplus. To determine the quantities demanded and supplied at a price of $120, we need to compare the original price and quantity with the new price and quantity. The original price is $100 and the original quantity demanded is 5 pairs per day. Assuming the demand remains the same, at the new price of $120, the quantity demanded is still 5 pairs per day. On the supply side, the store purchases 150 pairs of headphones per month from their suppliers. Assuming the supply remains the same, the quantity supplied at the new price of $120 is still 150 pairs per month. Therefore, at a price of $120, there would be a surplus of 145 pairs of headphones per month, meaning the quantity supplied exceeds the quantity demanded.

Answer 2

According to the law of supply, if the electronics store could sell the headphones for $120, there would be a surplus of 30 pairs.

Step-by-step explanation:

According to the law of supply, the quantity supplied of a product tends to increase as the price of the product increases. Therefore, if the electronics store could sell the headphones for $120 without losing customers, the quantity supplied would likely increase. Let's calculate the surplus or shortage:

1. The store usually sells 5 pairs of headphones per day.
2. Assuming there are 30 days in a month, the store usually sells 150 pairs in a month (5 pairs per day * 30 days).
3. If the price is increased to $120, the store might be able to sell more than 5 pairs per day. Let's say the store can sell 6 pairs per day. In a month, they would be able to sell 180 pairs (6 pairs per day * 30 days).
4. Therefore, the quantity supplied would be 180 pairs.
5. Since the store purchases 150 pairs from their suppliers per month, there would be a surplus of 30 pairs (180 pairs - 150 pairs).

So, if the store could sell the headphones for $120, there would be a surplus of 30 pairs.