Question

17. You are the CEO of a company that has developed an electric motorcycle (it uses no gasoline) with the pick-up of a gasoline powered motorcycle (0-60mph in 4.7 seconds). You conduct surveys of your anticipated market and the surveys suggest you can sell up to 800/week on a national level if you price them at $4,599 each, but only 250/week if you increase that to $6,900 apiece. Your manufacturing manager feels you could easily crank out 1,000/week if the price-point was $7.299, but only recommends supplying 350/week at $5,399. Determine the supply and demand functions and calculate your equilibrium point. When all is said and done, how many

Answer 1

Two counts on the demand come. __ (800, 4599) & (250, 6900) where x = Quantity demanded Y= Perice TE STE = -4.18 m (slope of the han CHP Y2-Y X2-X), = 69004599 = 250-800 regn of • sine is Y=mx+b r Let's staski m=-4.18 a & fount (250, 6900) 6900,,-4.18(250) tb 7945.90 = b 2 - hgn of the line is Demand: or Y= -4.188 +7945.90 p = -4.189 +7945.90 Two points on the supply corne: (1000, 7299) &°C 350, 5399) where x = Quantity suppleid - Y = Pruce m (slope of the righ) = 1 Y - Y1 = 7299-5399 = 2.92 X₂ X 1000-350 - Let's take m= 2.92 & point (1000, 7299) Y=mx+b 7299 = 12.92) (1000) +b - 4375.92 = b is ugn of supply Scanned with V CamScanner Y = 2.92 X + 4375,92 P= 2.92 Q +4375.92 CS - ®

solering o ê ② P= -4.18 Q + 7945.90 p = 2.92 Q + 4375.90 a O=-701Q + 3570 10*= 502.81 saty produced tore (9* €502) (afperose) is a - P=.-4.18 (502. ) +$1945-90 [P* = 5844.15., stay fece p*=5847.15 of we try to sell at a price higher than PE (5849. 15), supply is higher than demand , there will be a surplus of motorcycles R Scanned with i milliers CamScanner

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