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. Consider the market for umbrellas in Pasadena. P = 125 - 4QD P = 25 + QS a. What is the equilibrium price and quantity of umbrellas in this market? b. If the government sets the price for umbrellas at $80, describe the affect this will have on the quantity sold, and indicate if this is a price ceiling or a price floor.

. Consider the market for umbrellas in Pasadena. P = 125 - 4QD P = 25 + QS a. What is the equilibrium price and quantity of umbrellas in this market? b. If the government sets the price for umbrellas at $80, describe the affect this will have on the quantity sold, and indicate if this is a price ceiling or a price floor.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Please answer a and b and explain the answers:

. Consider the market for umbrellas in Pasadena. P = 125 - 4QD P = 25+ QS a. What is the equilibrium price and quantity of umbrellas in this market? b. If the government sets the price for umbrellas at $80, describe the affect this will have on the quantity sold, and indicate if this is a price ceiling or a price floor. c. What is the elasticity of demand at the equilibrium if the price increases by $10? d. Is demand elastic, inelastic or unit elastic?
Transcribed Image Text:. Consider the market for umbrellas in Pasadena. P = 125 - 4QD P = 25+ QS a. What is the equilibrium price and quantity of umbrellas in this market? b. If the government sets the price for umbrellas at $80, describe the affect this will have on the quantity sold, and indicate if this is a price ceiling or a price floor. c. What is the elasticity of demand at the equilibrium if the price increases by $10? d. Is demand elastic, inelastic or unit elastic?
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