5. Suppose that the market supply and demand for a nitrogen fertilizer are respectively expressed as follows: Qs 4P; QD = 10-P where Qs, Qu, and P are the quantity supplied, the quantity demanded, and the price of the fertilizer respectively. a. Find the market clearing price and quantity P* and Q*. (2 points) Qs=Qd 4P=10-P 5P-10 P=2 Qs=8 Qd=8 b. Draw to scale the demand and supply schedules and show on your graph the area representing the consumer surplus and the producer surplus. (4 points)
5. Suppose that the market supply and demand for a nitrogen fertilizer are respectively expressed as follows: Qs 4P; QD = 10-P where Qs, Qu, and P are the quantity supplied, the quantity demanded, and the price of the fertilizer respectively. a. Find the market clearing price and quantity P* and Q*. (2 points) Qs=Qd 4P=10-P 5P-10 P=2 Qs=8 Qd=8 b. Draw to scale the demand and supply schedules and show on your graph the area representing the consumer surplus and the producer surplus. (4 points)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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