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8 Jul 2022
Suppose D(q) = 422 - q^2 and S(q) = 1/3 q^2 + 8q + 2 are the demand and supply functions for a particular commodity. That is, q thousand units of the commodity will be demanded (sold) at a price of p = D(q) dollars per unit, while q thousand units will be supplied by producers when the price is p = S(q) dollars per unit. a. Find the equilibrium price p_0 where supply equals demand. Answer: p_0 = dollars per unit. b. Compute the consumers' surplus at equilibrium. Answer: CS = dollars. c. Compute the producers' surplus at equilibrium. Answer: PS = dollars.
Suppose D(q) = 422 - q^2 and S(q) = 1/3 q^2 + 8q + 2 are the demand and supply functions for a particular commodity. That is, q thousand units of the commodity will be demanded (sold) at a price of p = D(q) dollars per unit, while q thousand units will be supplied by producers when the price is p = S(q) dollars per unit. a. Find the equilibrium price p_0 where supply equals demand. Answer: p_0 = dollars per unit. b. Compute the consumers' surplus at equilibrium. Answer: CS = dollars. c. Compute the producers' surplus at equilibrium. Answer: PS = dollars.
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9 Jul 2022
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