Answer to Question #45002 in Economics of Enterprise for YOSEF ADAM

Question

1 Given market equilibrium of demand and supply of sugar,what happens to the level of equilibrium price and quantity if market demand increases by 50% while its supply increases by 40% ?

Answer 1

The equilibrium price will increase by 50 - 40 =10% and equilibrium quantity will increase by 40 + 50 = 90%.