QS= a+bp, QD = c-hp, what is equilibrium price and quantity demanded ?
At equilibrium
Quantity supplied equal quantity demanded.
Qs=QdQ_s =Q_dQs=Qd
∴\therefore∴
a+bp=c−hpa+bp= c-hpa+bp=c−hp
hp+bp=c−ahp+bp = c-ahp+bp=c−a
p(h+b)=c−ap(h+b)= c-ap(h+b)=c−a
PeP_ePe equilibrium price is
pe=c−ah+bp_e= \frac{c-a}{h+b}pe=h+bc−a
Qs=QdQ_s = Q_dQs=Qd
Quantity at equilibriumQeQ_eQe
Qe=QsQdQ_e = \frac{Q_s}{Q_d}Qe=QdQs
Qe=a+bpc−hpQ_e = \frac{a+bp}{c-hp}Qe=c−hpa+bp
Need a fast expert's response?
and get a quick answer at the best price
for any assignment or question with DETAILED EXPLANATIONS!
Comments