What are equilibrium price and quantity?
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1. Suppose the demand and supply functions for good X are Qd=50 -8P & Qs= -17.5 + 10P
(a) What are equilibrium price and quantity?
(b) What is the market outcome if price is $2.75? What would you expect to happen? Why?
(c) What is the market outcome if price is $4.25? What would you expect to happen? Why?
(d) What happens to equilibrium price and quantity if the demand function becomes Qd=59-8P?
(e) What happens to equilibrium price and quantity if the supply function becomes Qs=-40+10P (demand functions is Qd=50-8P)?
(f) Suppose that the demand and supply functions for good X are Qd = 56 – 2PX…
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