Assume a demand equation:
Qd= 9 - 0.1p - pc +0.01ps + 0.0001Y
and Supply equation...
Business, 25.04.2020 01:52 alizeleach0123
Assume a demand equation:
Qd= 9 - 0.1p - pc +0.01ps + 0.0001Y
and Supply equation:
Qs= 0.1p - 0.02pi +0.01N +0.01T - 0.1w
where
p= Price of the good
pc= price of the complement= $3
ps= price of substitute = $200
Y= Conusmer income= $20,000
Q= Quantity in thousands of units
pi= price of an input = $450
N= number of firms= 700
T= index of technology=300
w= wage rate= $10
Required:
If the price is $60, there will be an excess supply excess demand of nothing thousand units.
Answers: 3
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