32.5 q+1 Suppose that the inverse and direct supply functions are p = and p = 1 0.01q, respectively (where q is quantity and p is price). Show that the equilibrium price and quantity are 1.25 and 25, respectively. Using integral, determine the consumer, producer and social surplus.
32.5 q+1 Suppose that the inverse and direct supply functions are p = and p = 1 0.01q, respectively (where q is quantity and p is price). Show that the equilibrium price and quantity are 1.25 and 25, respectively. Using integral, determine the consumer, producer and social surplus.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter6: Simple Pricing
Section: Chapter Questions
Problem 8MC
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![Suppose that the inverse and direct supply functions are p
32.5
=
=
q+1
and p 10.01q, respectively (where q is quantity and p
is price). Show that the equilibrium price and quantity are 1.25 and 25, respectively. Using integral, determine the
consumer, producer and social surplus.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1ad428d1-d72c-4b86-8f12-941d5ec93ceb%2F211df9bc-9c7c-4e08-9292-8e20c921a60c%2Fhqezzof_processed.png&w=3840&q=75)
Transcribed Image Text:Suppose that the inverse and direct supply functions are p
32.5
=
=
q+1
and p 10.01q, respectively (where q is quantity and p
is price). Show that the equilibrium price and quantity are 1.25 and 25, respectively. Using integral, determine the
consumer, producer and social surplus.
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