Inverse market supply curve, Macroeconomics

Assignment Help:

Consider the market for the trusty widget (the most common good in the world if economics textbooks are to be believed). Assume that the market is perfectly competitive. Suppose the inverse market supply curve is given as:

P = 10 + 0.5QS

And that the inverse market demand curve is:

P = 22 - 2.5Qd

A) Find the market equilibrium price, PE, and the market equilibrium quantity, QE. Why is this price and quantity considered efficient?

B) Determine the value of the producer surplus and consumer surplus at equilibrium.

C) Find the total surplus, but this time use integration from 0 to QE to solve for this solution. Show that this is equivalent to the sum of CS and PS you found in Part (B).


Related Discussions:- Inverse market supply curve

What is a monopoly, When single business or corporation dominates its area ...

When single business or corporation dominates its area and squeezes out all its competition, the result is the consumer does not have a open choice, and inevitably, the price of it

Show the different kinds of unemployment, Q. Show the Different kinds of un...

Q. Show the Different kinds of unemployment? All unemployed individuals are presumed to belong to exactly one of these categories so that if we sum unemployment from each categ

Calculate the equilibrium price, Assume a market with demand Q = 16p^(--2) ...

Assume a market with demand Q = 16p^(--2) that is supplied by a monopoly with costs C(Q) = 6 + Q2/8. 1. Calculate the equilibrium price, output and monopoly profits. 2. What

Nations total income, If you take nations total income and subtract out pri...

If you take nations total income and subtract out private consumption government consumption what you will find?

Write the mass balance equation, Environmental engineers and scientists are...

Environmental engineers and scientists are becoming concerned about pharmaceuticals in the environment. An antibiotic is discharged into a small lake at an influent concentration o

What is meant by the term national debt?, When a government spends more tha...

When a government spends more than it receives in taxes; it runs a budget deficit, which is generally covered by issuing debt obligations to domestic and/or international investors

Monetization of public debt, What are the pros and cons of monetization of ...

What are the pros and cons of monetization of public debt

Government in the cross model, The government in the cross model ...

The government in the cross model Net taxes NT(Y) depends positively on real GDP in the cross model In this model when national income increase

What is monetary base, What is Monetary base The monetary base is defin...

What is Monetary base The monetary base is defined as the total value of all currency (banknotes and coins) outside the central bank and commercial banks' (net) reserves with t

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd