Calculate the equilibrium price and for good

Assignment Help Business Economics

Reference no: EM131202006

Suppose the demand function for a product is Q= 200 -15P + 4I where P is the per unit price of the good, I is median household income in thousands of dollars, and Q is the number of units demanded per month. Use the equation and assume that median family income remains at $30,000. a. If the equation for the supply curve is Q = 40P − 10, calculate the equilibrium price and for this good. How much will be bought and sold? b. If the government imposes a price ceiling at $5, Will a shortage or surplus result? How large will it be? c. If the government instead imposes a price ceiling at $11, what will the impact be? Explain.

Reference no: EM131202006

Questions Cloud

Understanding data is important part of decision making : Analyzing and understanding data is an important part of decision making. Econometrics is defined as the statistical methods used to analyze data and make informed decisions. For this assignment, you are required to research data related to an econom..

Inspired by power and wholesome goodness of amazing oat : The mission statement for Quaker Oats cites its origins, “inspired by the power and wholesome goodness of the amazing oat.” Frito-Lay looks a little more to the present, citing its mission “To be the world’s favorite snack and always within arm’s rea..

Impact on the equilibrium price and quantity of skateboards : If certain jurisdictions ban the use of skateboards on city streets and parks, how would the demand curve and/or the supply curve for skateboards be affected? What would be the impact on the equilibrium price and quantity of skateboards? It is argued..

What is monopoly mark-up-rent and lerner index : if government regulates the maximum price monopoly can charge at $23: What is the monopoly’s regulated demand curve? monopoly’s regulated MR curve? Regraph the chart here and mark these curves in different colors. What is monopoly’s regultated output..

Calculate the equilibrium price and for good : Suppose the demand function for a product is Q= 200 -15P + 4I where P is the per unit price of the good, I is median household income in thousands of dollars, and Q is the number of units demanded per month. Use the equation and assume that median fa..

Is the law of demand met and good normal or inferior : Assume that products A and B are produced in competitive markets by different firms and are close substitutes. How would an increase in the price of product A affect the price of product B, and total expenditure on product B? Is the Law of Demand met..

The levels of consumption before trade : Suppose that without trade, France is producing 50 units of cheese and 25 units of oilves, while Spain is producing 150 units of cheese and 100 units of olives. Now assume France specializes according to its comparative advantage and produces the max..

What would be the real wage of the workers in two countries : Suppose in the United States, one worker can produce 10 tons of steel per day or 20 tons of chemicals per day. In the United Kingdom, one worker can produce 5 tons of steel per day or 15 tons of chemicals per day. The United States has 30 workers and..

Federal government budget rapidly at the present time : Each year since winning control of the House of Representatives in the 2010 election, Tea Party Republicans have argued that we need to immediately initiate sharp reductions in government spending and entitlement programs and rapidly move towards a b..

User Account

All Pages