Question

1. Suppose the market demand for Good is given by the equation Qd = 1000 – 20P, and market
supply is given by the equation Qs = 500 +30P, then
A. Find quantity demanded and quantity supplied when the price of good X = Br. 12. Is there a
surplus or shortage in the production of Good X? What should happen to the price of Good
X?
B. Find the equilibrium price for good X by equating
C. Calculate the price elasticity of demand and supply at equilibrium (interpret the value )

Answer 1

Answer:

1. Suppose the market demand for Good is given by the equation Qd = 1000 – 20P, and market

supply is given by the equation Qs = 500 +30P, then

A. Find quantity demanded and quantity supplied when the price of good X = Br. 12. Is there a

surplus or shortage in the production of Good X? What should happen to the price of Good

X?

B. Find the equilibrium price for good X by equating

C. Calculate the price elasticity of demand and supply at equilibrium (interpret the value )