Answer to Question #223780 in Macroeconomics for SPENCER

Question

Q1.

a) suppose the supply function in a market is Q^S = P² and the current market price is P^*= 4 .What is the producer surplus?

b) demand function is given by Q^d (P)= 10 - P^0.5

i. find the interval of prices for which demand is positive

ii. express total revenue TR= PQ as a function of price . when total revenue is maximized.

iii. for which price is the own-price elasticity is equal to -1?

Answer 1

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