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Can someone help me solve those three questions? thank you so much

Solve the following sets of equations (4 points) 1. Qs 3 5P (supply) find equilibrium Q and P Qd 63 -15P (demand) (supply) find equilibrium Q and P P 55-2Qd (demand)

Using Elasticities (6 points) Show your work for full points. 1. What is the percent change in quantity demanded if demand elasticity is (-02) and price has increased 10%? 2. What is the percent change in quantity suppplied if elasticity of supply is 0.4 and price has decreased 5%?

You are given a Demand function for beer Qb 40 -5Pb+5Pw +.5Y where Qb $10 and starting income is $120. quantity of beer, Pb price of beer, Pw price of wine, and Y income. The starting price of wine is Graph 1. eveiu and heuidlin henerent Worto oeua tuncton of P, assuming Income and price of wine are fred at the above included in the intercept. Write out that equation. Draw a graph with Pb on the Vertical Axis and Qb on the Horizontal axis to depict the starting demand function for Beer. Label the correct intercepts for both price and quantity Now increase the price of wine (Pw) to $20. That will hit your intercepts. Write out the new equation. Add the new Demand function with all new intercepts to the graph above. Is wine complementary to beer? Graph 2. Re-Draw a graph to depict the original starting demand function for Beer Leave Pw-310 for this graph. Again label the intercepts. Now decrease income (Y) to $60. Again that will shift your intercepts. Write out that equation. Add the new Demand function to the graph above. Is beer a normal good?

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Homework Answers

Answer #1

Answer 1 : Equilibrium price and Quantity

Q​​​​​​ d = Q s

3+5P= 63-15P

60= 20P

P=$3

Q= 3+5P= 3+5(3)= 18 units

Answer 2: P= -5+3Q s

P= 50-2Q d

Q s =( P+5)/3

Q d = (50-P)/2

Q d = Q s

(50-P)/2 = ( P+5)/3

150-3P= 2P+10

140= 5P

P= $28

Q= 11units

Answer Using elasticity:

1. Elasticity of demand ( E d)= % change in quantity demanded/% change in the price

E d = -0.2

-0.2= % Change in quantity demanded/10%

- 2% =%change in quantity demanded

Therefore when the price has been increased by 10% then the quantity demanded has been decreased by 2%.

Answer 2: E s = 0.4

% change in price = 5%

E s = %Change in Quantity supplied/ %change in. Price

0.4*5%= % change in quantity supplied

2% =% change in quantity supplied

Therefore when price has been decreased by 5% then the quantity supplied has been decreased by 2% there is it correct relationship between quantity supplied and change in price.

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