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2. In the market for good X, demand is QD = 6,000 – 0.8P and supply...

2. In the market for good X, demand is QD = 6,000 – 0.8P and supply is QS = 0.4P – 300. a. Derive the inverse demand and inverse supply equations. b. What is the equilibrium price and quantity? c. Calculate the price elasticity of demand and the price elasticity of supply at the equilibrium. d. Suppose that an increase in consumer income makes consumers willing to pay $500 more per unit of good X, what is the new demand curve? e. Suppose that another increase in consumer income makes consumers willing to buy 200 units of good X at every price, what is the new demand curve? f. Also, a technological breakthrough in production makes firms willing to sell good X for $500 less per unit, what is the new supply curve?

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