Question

The demand and supply equations for the Wheat market are: Demand: P = 200-4q Supply: P = - 50 + Q Where P = price per bushel, and Q = quantity 1. Calculate the equilibrium price and quantity. (1.5 Marks) 2. Suppose the government guaranteed producers a price floor of AED 90 per bushel. Estimate the effect on the quantity supplied and demanded. (1.5 Marks) 3. Would the price floor affect the Market outcome? (Calculate the surplus or shortage ). (1.5 Marks)

Answer #1

**Details Given Above:**

1. Demand Equation: P = 200-4q

2. Supply Equation: P = -50+Q

To Arrive Equilibrium Price and Quantity Supplied and Quantity Demanded should be equal

Demand Equation can be written as ---------------------4q =
200-P ie., q_{d} = (200-P)/4

Supply Equation Can be written as
------------------------Q_{s} = P+50

At Equilibrium: q_{d =} Q_{s}

_{(200-P)/4 = 50-P/4 = P+50}

_{-P/4 -P = 50 -50}

_{4(-P/4-P) = 0}

_{-P-4P=0}

_{-5P =0}

_{0=5P}

Price at equilibrium is 0 (Zero)

Equation for Quantity Demanded 4q = 200-P

4q = 200 -0

q = 200/4 = 50

**2. If the Floor Price is Rs. 90**

Demand Equation q_{d} = (200-P)/4 = (200-90)/4 =
27.5

Supply Equation Q_{s} = P+50 = 90+50 = 140

**3. Would the Supply price affect the market
outcome?**

Yes. as the floor price is fixed above equilibrium price the Supply increased and demand fallen as above

Subject: Managerial Economics
Given the demand and supply equations for wheat Qd =
40 - 3P and Q5 = 5 + 2P. Quantity is measured in bushels
and price is in dollars per bushel. Answer the following
questions:
4.1 What are equilibrium price and quantity?
4.2 Determine quantity demanded, quantity supplied and the
dollar value of the surplus given a price floor of $9.
4.3 Determine quantity demanded, quantity supplied and the
dollar value of the shortage given that there...

The inverse demand curve for wheat is p = 10 – 0.10Q and the
inverse supply curve is p = 0.40Q, where p = dollars per bushel and
Q is billions of bushels of wheat. Wheat is bought and sold in a
perfectly competitive market.
a. Provide a graph of the market for wheat and calculate and
show the equilibrium price and quantity (in billions of bushels) in
the market.
b. If the government provides a price support of $9...

Suppose the market for corn is given by the following equations
for supply and demand:
QS = 2p − 2
QD = 13 − p
where Q is the quantity in millions of bushels per year and p is
the price.
Calculate the equilibrium price and quantity.
Sketch the supply and demand curves on a graph indicating the
equilibrium quantity and price.
Calculate the price-elasticity of demand and supply at the
equilibrium price/quantity.
The government judges the market...

A market is described by the following supply and demand
curves:
QSQS
= =
3P3P
QDQD
= =
400−P400−P
The equilibrium price is______
and the equilibrium quantity is_______
.
Suppose the government imposes a price ceiling of $80. This
price ceiling is (binding or not binding) , and
the market price will be
. The quantity supplied will be______
, and the quantity demanded will be_____
. Therefore, a price ceiling of $80 will result in (a
shortage, neither a shortage nor...

A market is described by the following supply and demand
curves:
QS = 2P
QD = 400 - 3P
Solve for the equilibrium price and quantity.
If the government imposes a price ceiling of $70, does a
shortage or surplus (or neither) develop? What are the price,
quantity supplied, quantity demanded, and size of the shortage or
surplus?
If the government imposes a price floor of $70, does a shortage
or surplus (or neither) develop? What are the price, quantity...

Suppose the corn market has the following equations: QD = 3000 -
400P QS = 900 + 300P Where QD and QS are quantity demanded and
quantity supplied measured in bushels, and P = price per
bushel.
Determine consumer surplus at the equilibrium price and
quantity. 6 marks
Assume that the government has imposed a price floor at $3.50
per bushel and agrees to buy any resulting excess supply. How many
bushels of corns will the government be forced to...

Suppose the demand and supply for a product is given by the
following equations:
p=d(q)=−0.8q+150
(Demand)
p=s(q)=5.2q
(Supply)
For both functions, q is the quantity and p is the price.
Find the equilibrium point. (Equilibrium price and equilibrium
quantity) (1.5 Marks)
Compute the consumer surplus. (1.5 Marks)
Compute the producer surplus. (1.5 Marks)

Suppose demand and supply are given by Qd =
60 - P and Qs = 1.0P
- 20.
a. What are the equilibrium quantity and price in this
market?
Equilibrium quantity:
Equilibrium price: $
b. Determine the quantity demanded, the quantity supplied, and the
magnitude of the surplus if a price floor of $52 is imposed in this
market.
Quantity demanded:
Quantity supplied:
Surplus:
c. Determine the quantity demanded, the quantity supplied, and the
magnitude of the shortage if a price...

The equations for the demand and supply curves for a particular
product are P = 10 - .4Q and P = 2 + .4Q respectively, where P is
price and Q is quantity expressed in units of 100. After an excise
tax is imposed on the product the supply equation is P = 3 + .4 Q.
a- Compute equilibrium price and quantity before and after tax.
b-Calculate government's revenue from this tax. C- Calculate share
of producers and consumers...

Suppose that the market demand and supply for milk is given
by
Qd =120−6P
and
Qs = 12P − 60
a. Find the market equilibrium quantity, and the equilibrium price.
(5 points)
b. Determine the quantity demanded, the quantity supplied, and
the magnitude of the surplus (or shortage) if a price floor of $11
is imposed in this market. (5 points)
c. Determine the quantity demanded, the quantity supplied, and
the magnitude of the surplus (or shortage) if a price...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 10 minutes ago

asked 19 minutes ago

asked 33 minutes ago

asked 36 minutes ago

asked 53 minutes ago

asked 56 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago