Answer to Question #288464 in Macroeconomics for Simarjeet

Question

Here is the more information about the market for onions in Vancouver .

Price per unit- 5,8,11,14,17etc

Quantity supplied-7,16,25,34,43etc

*Find the equation for the supply curve .

*What is the quality supplied when price =16?

* What is the cost of producing quantity supplied = 10 ?

Answer 1

Coordinates=(7,5), (16,8), (25,11), (34,14), (43,17)

Use any two coordinates to find the Slope

Form of a straight line= Y=X+mX

Where; m= Slope

X= Quantity supplied

Y= Price

$\frac{(8-5)}{(16-7)}=\frac {3}{9}=\frac{1}{3}$

Using the Slope

Assume a coordinate with (X,Y) and use it with any of the above coordinates

$\frac{(Y-8)}{(X-16)}=\frac{1}{3}$

$(Y-8)3=X-16$

3Y-24=X-16

3Y=X+8

$Y=\frac{1}{3}X+\frac{8}{3}$

$\therefore Q_s=\frac{1}{3}p+\frac{8}{3}$

Quantity supplied at price 16

$Q_s=\frac{1}{3}(16)+\frac{8}{3}$

$=\frac{16}{3}+\frac{8}{3}=\frac{24}{3}= 8$

Cost of producing quantity supplied= $8\times 10= 80$