Market demand function of commodity X is given as: DD, = 60 – 5P, where P, > 0 a) (5 points) Derive the Market Demand Schedule. [Hint: Assume different values of P. and find corresponding values for DD,] b) (5 points) Draw the market demand curve? What's the slope of the curve? c) (10 points) Using the market supply schedule from Problem 4b, determine the Market equilibrium quantity of X and market equilibrium price of X. Show the equilibrium Price and Quantity in a Diagram. d) (5 points) What happens when Pz is less than the equilibrium market price?

Market demand function of commodity X is given as: DD, = 60 – 5P, where P, > 0 a) (5 points) Derive the Market Demand Schedule. [Hint: Assume different values of P. and find corresponding values for DD,] b) (5 points) Draw the market demand curve? What's the slope of the curve? c) (10 points) Using the market supply schedule from Problem 4b, determine the Market equilibrium quantity of X and market equilibrium price of X. Show the equilibrium Price and Quantity in a Diagram. d) (5 points) What happens when Pz is less than the equilibrium market price?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Similar questions

▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪▪ 03: If the supply and demand functions for a commodity are 100+ 2(4 + Pa = -(Q.) P₁ = (Q + 2)² E plot each function on the same graph Estimate the equitum pana and quantity signhramaly and graphicaly **********‒‒‒‒‒‒‒‒‒‒‒‒‒
Given the two functions below: y=10e-0.5q and y=7ln5q Draw the two functions for the interval -1<q<3. From the diagram drawn identify which of the two functions represents the demand curve, supply curve and name the intercept(s) formed. Economically, it is said that equilibrium is established when the demand curve intercepts the supply curve. Hence or otherwise, determine the equilibritum price and quantity.
The demand for bacon is given by Q d=70-3p and the supply is Q s=2p-30. (a). Draw the demand and supply functions. Find the equilibrium quantity and price, and show them on the graph. (b). Suppose due to increased health awareness the demand changes to 50-3p. The supply remains the same. Draw the new demand function on the same graph, and find the new equilibrium price and quantity. Has the demand increased or decreased? How did the equilibrium price and quantity change compared to part a.?
Problem #3 - Supply/Demand An potter sells handmade mugs on their website and has found that if the price for a mug is set at $22 they will sell 60 mugs and if they set the price at $35 they will only sell 21 mugs. You must show your work on all parts! a. Construct the monthly linear demand function. Use p for the price (dollars per mug) of the produce and q for the number of mug demanded. b. Find the equilibrium price if the monthly supply function is given by: q-0.003p² + 2p+10.5 Round to the nearest cent (i.e. $0.01). Include correct units. C. Report the monthly surplus or shortage when the price is $25. What is the corresponding revenue? Include correct units.
2. Consider a small island economy where the government is contemplating imposing a tax on bananas to raise revenue for public projects. The islanders' utility from consuming bananas (B) and coconuts (C) is given by the Cobb-Douglas utility function: U(B, C)=B°C1-a where a = 0.3. (a) Write down the consumer's optimization problem and derive the demand functions for bananas and coconuts. (b) Suppose the initial prices are PB $2 and Pc = = $4, and the consumer's income is I = $100. Calculate the initial quantities of bananas and coconuts consumed. (c) Calculate the compensating variation (CV) and equivalent variation (EV) for a tax rate of t = $0.50. Interpret your results in terms of the impact on consumer welfare. (d) Determine the tax revenue per consumer after the tax is imposed, assuming supply is perfectly elastic so the tax falls entirely on consumers. (e) Compare the impacts on consumer welfare between a flat tax equal to the revenue found in part (d) and the per-unit tax.
Suppose that the utility derived by the consumer from x units of the first commodity and y units of the second commodity is given by the utility function U(x, y) = 10x0.6y0.4 The first commodity costs $ 20 per unit and the second $ 30 per unit. Both x and y are continuous variables. a) Find the function equation for the cost function C(x, y). Draw a contour plot of C (x, y) showing the contour lines of levels 500, 600 and 700. b) Add a contour plot of U(x, y) to this graph in which you draw contour lines of levels 100, 150 and 200. You are allowed to use the graphical calculator to graph a function from its explicit function equation. c) The consumer wants to maximize utility with a budget of $ 600. Indicate the correct option below: The maximum utility is below 100. The maximum utility is between 100 and 150. The maximum utility is larger than 150. Explain your answer based on the graph you made so far; d) Estimate how many units of each commodity the consumer should buy to minimize…
buyers in the chocolate market demand 200 units of chocolate when price is zero and decrease the purchase of chocolates by 2 units for every one unit increase in price. write down the equation of the demand function in the form of Q= f(P)
Given the two functions below: y=10e -0.05q and y=7ln5q Draw the two functions for the interval -1<q<3. Identify from the diagram drawn which of the two functions represents the demand curve, supply curve and name the intercept(s) formed.
1) Given the below functions for supply and demand: Supply: P = In (Q – 3) Demand: P = 22e¬arctan (Qp) Find the equilibrium price using the welfare optimization method directly.
For a demand function Qd = f (P), a change in price causes a change in the quantity demanded. There are other five (5) variables, enumerate and explain each variable influencing demand in the general demand function. These are fixed at specific values for a given demand equation.
The supply and demand for a computer in a store are given for two prices: for a price of $800, the demand quanity is 50 and the supply quanity 230: for a price of $50, the demand quanity is 150 and the supply quantity 150. Let a represent the quanity A. Write an equation representing the demand function B. Write an equation representing the supply function C. Find the equlibrium quantity and price
The demand and supply functions for a particular commodity are D(x) = 80e-0.001x and S(x)= 30e0.001r , where x is the number of units of the product, D(x) is the price that results in a consumer demand of x units and S(x) is the price that results in a producer supply of x units. a. Find the equilibrium point using your calculator and identify the equilibrium units and price. Give your answers to the nearest whole unit and nearest dollar. The value of x at equilibrium is units. The value of p at equilibrium is b. Determine the consumers' surplus.