suppose Qdx=10,000 - 2Px+Py-4.5M, where M=$2,000. using the two figures below, draw one detailed graph of the market demand curve for good X assuming Py=$150 and a second detailed graph of the market demand curve for good X assuming Py=$300. On each graph, show the quantity demanded when Px=$300 Are good X and good Y complements or substitute goods?
suppose Qdx=10,000 - 2Px+Py-4.5M, where M=$2,000. using the two figures below, draw one detailed graph of the market demand curve for good X assuming Py=$150 and a second detailed graph of the market demand curve for good X assuming Py=$300. On each graph, show the quantity demanded when Px=$300 Are good X and good Y complements or substitute goods?
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The generalized demand and supply functions for good X are
Qd = 10 -2Px - 4PY + M Qs = 10 + 2PX
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Where: QD = quantity demanded of good X PX = price of good X M = consumer income PY = price of good Y |
QS = quantity supplied of good X PX = price of good X
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A. Are good X and good Y substitutes or complements? Why?
B. Is good X a normal good or an inferior good? Why?
C. What is the demand function when PY = $4 and M = $600?
d. Use the demand function you found in part c. and solve for the equilibrium price (Po) and the equilibrium quantity (Qo).
e. Find the inverse demand function and the inverse supply function.
f. Sketch this market.
