2. Suppose the demand function is p = 50 - 2q, and thesupply function isp = 10 + 3q.a) Find the equilibrium pointb) Sketch a graphc) Compute consumer surplus at equilibrium priced) Compute producer surplus at the equilibrium pricee) If the government fixes a price ceiling equal 30dollars per unit compute producer and consumersurplus at that pointf) What is the level of production?g) Is there a shortage or surplus in the market? If thereis a shortage or surplus compute the surplus orshortage volume.

p = 50 - 2q --> demand function p = 10 + 3q ----> supply equation.

Answered: 2. Suppose the demand function is p =…

2. Suppose the demand function is p = 50 - 2q, and the supply function is p = 10 + 3q. a) Find the equilibrium point || b) Sketch a graph c) Compute consumer surplus at equilibrium price

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

2. Suppose the demand function is p = 50 - 2q, and the
supply function is
p = 10 + 3q.
a) Find the equilibrium point
b) Sketch a graph
c) Compute consumer surplus at equilibrium price
d) Compute producer surplus at the equilibrium price
e) If the government fixes a price ceiling equal 30
dollars per unit compute producer and consumer
surplus at that point
f) What is the level of production?
g) Is there a shortage or surplus in the market? If there
is a shortage or surplus compute the surplus or
shortage volume.

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