Express the equilibrium production level

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Producers will supply q units of a certain commodity to the market when the price is p = S(q) dollars per unit, and consumers will demand (buy) q units when the price is p = D(q) dollars per unit, where S(q) = aq +b and D(q) = cq + d for constants a, b, c, and d.

a. What can you say about the signs of the constants a,b,c, and dif the supply and demand curves are as shown in the accompanying ?gure?

b. Express the equilibrium production level qe and the equilibrium price pe in terms of the coef?cients a, b, c, and d.

c. Use your answer in part (b) to determine what happens to the equilibrium production level qe as a increases. What happens to qe as d increases?

Reference no: EM131452810

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