1. Suppose the demand for pizza is given by Qd = 300-20P and the market supply for pizza is given by Qs = 20P – 100 where P = price per pizza a) Graph the supply and demand schedules for pizza using P100 through 150 as the value of pizza and show equilibrium price and quantity b) What would happen if suppliers set the price of pizza at 50? Explain the market adjustment process. c) Suppose the price of hamburgers, a substitute for pizza doubles leading to a doubling of demand for pizzas (at each price consumers demand twice as much pizza as before). Show on a graph and what will be new equilibrium price and quantity of pizza? d)What would happen if suppliers set the price of pizza at 100? Explain the market adjustment process.
1. Suppose the
a) Graph the
b) What would happen if suppliers set the price of pizza at 50? Explain the market adjustment process.
c) Suppose the price of hamburgers, a substitute for pizza doubles leading to a doubling of demand for pizzas (at each price consumers demand twice as much pizza as before). Show on a graph and what will be new equilibrium price and quantity of pizza?
d)What would happen if suppliers set the price of pizza at 100? Explain the market adjustment process.
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