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Prices of other related goods
i) Substitutes: If X and Y are substitutes, then if the price X increases, the quantity demanded of X falls. This will lead to increased demand for Y, and this way eventually lead to increased supply of Y.
ii) Complements: If two commodities, say A and B are used jointly, then an increase in the price of A shall lead to a fall in the demand for A, which will cause the demand for B to fall too.
explian williomson model of managerial discretion
Suppose you have estimated the following demand function for the product you sell: Q = 5 - 0.2P At what price will the demand for your product be unitary elastic? (Hint: B
how to solve problems using derivatives ?
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Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price floor of $20 is set, what will be the size of the resulting surplus?
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Provide two examples of identity economics other than those given in the article
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