2. Suppose the individual demand for consumer 1 is D1(p)=200-4p and for consumer 2 is D2(p)=125-2.5p. Assume there is only one producer in the economy who supplies S(p). a. Graph the individual demand...
2. Suppose the individual demand for consumer 1 is D1(p)=200-4p and for consumer 2 is D2(p)=125-2.5p. Assume there is only one producer in the economy who supplies S(p).
a. Graph the individual demand curves as well as the resulting market demand curve. Mark the intercepts correctly.
b. What is the price elasticity of the Market Demand at p=10?
c. If supply is given by p = 40, find the amount purchased by each consumer. Illustrate your answer graphically.
d. If instead the supply is given by S(p) = 100, find the equilibrium market price. Illustrate your answer graphically.
Homework Answers
Market demand is the sum total of individual demand.
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2. Suppose the individual demand for consumer 1 is D1(p)=200-4p and for consumer 2 is D2(p)=125-2.5p. Assume there is only one producer in the economy who supplies S(p). a. Graph the individual demand...
Suppose Q D = 200 – 4P and Q S = 100 describe market demand and...
Suppose Q D = 200 – 4P and Q S = 100 describe market demand and market supply in a given market. Find the equilibrium price and quantity for this market. Graph both supply and demand for this market. Compute the consumer and producer surplus for this market. Give an example of a good in the real world that might be described by this graph
Consider a market with demand and supply functions of the form: D:Q^D=28-4P^D S:Q^s=-2+P^s a. Graph and...
Consider a market with demand and supply functions of the form: D:Q^D=28-4P^D S:Q^s=-2+P^s a. Graph and calculate the market equilibrium price and quantity. b. Graph and calculate the consumer surplus. c. Graph and calculate the producer surplus. d. Imagine the government imposes a $1 per unit tax on consumption of the good. Graph and calculate the deadweight loss of the tax.
1. Suppose supply in a market is Qs = P + Ps = 30, where P is the price and Q is the quantity. There is perfect competi...
1. Suppose supply in a market is Qs = P + Ps = 30, where P is the price and Q is the quantity. There is perfect competition in this market and demand is Qp = 80 - P + PD = 160 - 20. (D) The equations to the right are the inverse functions. (a) Calculate price and quantity in equilibrium. Illustrate the equilibrium in a figure. Mark carefully the slopes and in- tercepts (the intersections of the curves...
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p ....
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p . The other has demand function D2(p)=20-2p. The only firm in this market has constant marginal cost of 2. (1) Draw the two demand curves in a graph, with price on the vertical axis and demand on the horizontal axis. (2) (3rd-degree price discrimination) If the monopoly can identify the two consumers and charge different prices to them, what is the optimal price charged to...
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p ....
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p . The other has demand function D2(p)=20-2p. The only firm in this market has constant marginal cost of 2. (1) Draw the two demand curves in a graph, with price on the vertical axis and demand on the horizontal axis. (2) (3rd-degree price discrimination) If the monopoly can identify the two consumers and charge different prices to them, what is the optimal price charged to...
can you answer question 3 only plz thank you i need it as soon as possible Home demand: D 100-20P Home supply: S 30+20P What is the import demand schedule in home country, what is the equilibrium...
can you answer question 3 only plz thank you i need it as soon
as possible
Home demand: D 100-20P Home supply: S 30+20P What is the import demand schedule in home country, what is the equilibrium price without trade? b Please draw the demand and supply curves at home, calculate and mark domestic consumer surplus and producer surplus without trade on the graph. 2 Foreign demand D 80-20P* Foreign supply: S 50 20P* What is the export supply schedule...
Basic Microeconomics D-S Analysis: Suppose the demand and supply curves are specified as: Qa = 100-P...
Basic Microeconomics D-S Analysis: Suppose the demand and supply curves are specified as: Qa = 100-P & Q. =P -20. (a) What is the equilibrium price and quantity in this market? (b) Solve for producer surplus and consumer surplus at equilibrium. (c) Construct a D-S diagram depicting (a) and (b) above. (d) Suppose the government sets a price ceiling = $50. i. Solve for the surplus or shortage at this price. ii. Solve for the resulting consumer surplus and producer...
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p ....
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p . The other has demand function D2(p)=20-2p. The only firm in this market has constant marginal cost of 2. (2nd-degree price discrimination) Given the market as described in the above question, suppose the monopolist cannot identify the two consumers, but he can use a single two-part tariff. (a)Find out the optimal fixed fee and per-unit price. (b)Is it more profitable to serve both consumers or...
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p ....
1. Suppose there are two potential customers in the market. One has demand function D1(p)=10-p . The other has demand function D2(p)=20-2p. The only firm in this market has constant marginal cost of 2. (2nd-degree price discrimination) Given the market as described in the above question, suppose the monopolist cannot identify the two consumers, but he can use a single two-part tariff. (a)Find out the optimal fixed fee and per-unit price. (b)Is it more profitable to serve both consumers or...
1. Suppose that the initial demand and supply curves for coffee are illustrate by D' and...
1. Suppose that the initial demand and supply curves for coffee are illustrate by D' and St in the graph below. Assume that coffee and kringle are complements in consumption. Clearly label all additions to the graph. a) Suppose that the initial market price of coffee, Po, is $1 per cup (Po = $1). Determine and illustrate the quantity demanded at Po (labeled as Qc), and the quantity supplied at Po (labeled as Qoʻ). Show Qoand Qos on the quantity...
1. Suppose supply in a market is Qs = P + Ps = 30, where P is the price and Q is the quantity. There is perfect competition in this market and demand is Qp = 80 - P + PD = 160 - 20. (D) The equations to the right are the inverse functions. (a) Calculate price and quantity in equilibrium. Illustrate the equilibrium in a figure. Mark carefully the slopes and in- tercepts (the intersections of the curves...
can you answer question 3 only plz thank you i need it as soon
as possible
Home demand: D 100-20P Home supply: S 30+20P What is the import demand schedule in home country, what is the equilibrium price without trade? b Please draw the demand and supply curves at home, calculate and mark domestic consumer surplus and producer surplus without trade on the graph. 2 Foreign demand D 80-20P* Foreign supply: S 50 20P* What is the export supply schedule...
Basic Microeconomics D-S Analysis: Suppose the demand and supply curves are specified as: Qa = 100-P & Q. =P -20. (a) What is the equilibrium price and quantity in this market? (b) Solve for producer surplus and consumer surplus at equilibrium. (c) Construct a D-S diagram depicting (a) and (b) above. (d) Suppose the government sets a price ceiling = $50. i. Solve for the surplus or shortage at this price. ii. Solve for the resulting consumer surplus and producer...
1. Suppose that the initial demand and supply curves for coffee are illustrate by D' and St in the graph below. Assume that coffee and kringle are complements in consumption. Clearly label all additions to the graph. a) Suppose that the initial market price of coffee, Po, is $1 per cup (Po = $1). Determine and illustrate the quantity demanded at Po (labeled as Qc), and the quantity supplied at Po (labeled as Qoʻ). Show Qoand Qos on the quantity...
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