A good's Demand Curve is QD = 50 - 2P, and its Supply Curve is QS = 40 + P
a. When P = $10, what is the difference, if any, between QD and QS?
b. When P = $2, what is the difference, if any, between QD and QS?
c. What are the equilibrium values of P and Q?
a. QD = 30 and QS = 50
b. QD = 46 and QS = 42
c. Q = 43.33 and P = $3.33
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The market demand for the product of a monopolistic competitor will likely be
A) unitary elastic. B) relatively inelastic. C) relatively elastic. D) perfectly elastic.
Answer the following questions true (T) or false (F)
1. When voluntary exchange takes place, neither party gains from the exchange. 2. A college must decide if it wants to offer more adult literacy classes. This decision involves answering the economic question of "what to produce." 3. In a centrally planned economy, the households and firms decide how economic resources will be allocated.