There are two closely related crops, X and Y, with the following demand functions QX = 180 - 2PX + PY and QY = 150 + PX - PY where QX is the quantity of X, PX is the price of X, QY is the quantity of Y, and PY is the price of Y
These two crops are grown in two widely separated countries so there is no interrelationship between the supply curves. The short-run perfectly inelastic supply for X is 150 while the short-run perfectly inelastic supply for Y is 100. In equilibrium, the prices are A) PX = 80, PY = 130
B) PX = 40, PY = 65
C) PX = 60, PY = 120
D) PX = 30, PY = 80
A
You might also like to view...
Which of the following will result in secular deflation?
A) a one-time rightward shift of the long-run aggregate supply curve B) continuous rightward shifts of the aggregate demand curve C) continuous rightward shifts of the long-run aggregate supply curve D) a one-time rightward shift of the aggregate demand curve
Asset specificity means lower costs of redeployment and lower risks of opportunism associated with a contract
Indicate whether the statement is true or false