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General Equi. Math

This document discusses the concepts of supply and demand equilibrium through 5 examples involving different markets. It provides the demand and supply equations/schedules for markets of pizza, eggs, ice cream, disposable cameras, and burritos. For each market, it asks the reader to graph the demand and supply curves, identify the equilibrium price and quantity, and analyze how the market would adjust if the price was set above or below equilibrium levels.

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Nourin Tasnim
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58 views2 pages

General Equi. Math

This document discusses the concepts of supply and demand equilibrium through 5 examples involving different markets. It provides the demand and supply equations/schedules for markets of pizza, eggs, ice cream, disposable cameras, and burritos. For each market, it asks the reader to graph the demand and supply curves, identify the equilibrium price and quantity, and analyze how the market would adjust if the price was set above or below equilibrium levels.

Uploaded by

Nourin Tasnim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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General equilibrium

1. Suppose the market demand for pizza is given by and the market supply for
pizza is given by, where p=price per pizza

Q s = 20P - 100

Qd = 300 - 20P

a. Graph the supply and demand schedules for pizza using $5 through $15 as the
value of P.

b. In equilibrium, how many pizzas would be sold and at what price?

c. What would happen if suppliers set the price of pizza at $15? Explain the
market adjustment process.

2. Suppose the demand and supply curves for eggs in the United States are given
by the following equations: Qs = 10 + 40P

Qd= 100 - 20P

Where Qd= millions of dozens of eggs Americans would like to buy each year; Qs =
millions of dozens of eggs U.S. farms would like to sell each year; and p=price per
dozen of eggs.

a. Fill in the following table:

PRICE (PER DOZEN) QUANTITY DEMANDED QUANTITY SUPPLIED ( )


( ) Qd Qs
$ .50
$1.00
$1.50
$2.00
$2.50
b. Use the information in the table to find the equilibrium price and quantity.

c. Graph the demand and supply curves and identify the equilibrium price and
quantity.

3. Suppose the market demand and the market supply for ice-cream is given by,
where p=price

Q s = 20P

Qd = 10,000 - 80P
a. Graph the supply and demand schedules using 20,40,60,80,100 & 120 as the
value of P.

b. In equilibrium, how many ice-cream would be sold and at what price? Show the
equilibrium.

c. What would happen if suppliers set the price at tk 140 & at tk 80. Explain the
market adjustment process

4. The following table represents the market for disposable digital cameras. Plot
this data on a supply and demand graph and identify the equilibrium price and
quantity. Explain what would happen if the market price is set at $30, and show
this on the graph. Explain what would happen if the market price is set at $15,
and show this on the graph.

PRICE($) QUANTITY DEMANDED QUANTITY SUPPLIED


5 15 0
10 13 3
15 11 6
20 9 9
25 7 12
30 5 15
35 3 18

5. Suppose the market demand for burritos is given by Qd = 40 – 5P and the


market supply for burritos is given by Qs = 10P – 20, where P = price (per burrito).
a. Graph the supply and demand schedules for burritos.
b. What is the equilibrium price and equilibrium quantity?
c. Calculate consumer surplus and producer surplus and identify these on the
graph.

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