Q4) Assume a market of a specific good. The demand and supply equation is as shown below: Po = 70 – 3Q0 Ps = 5 + 20s The demand price elasticities is inelastic. From the firms' perspective, the revenue would be higher if price increases. Let's assume that the market is currently not at the equilibrium with the market price being higher by 2 units than the equilibrium price. 1. Find the market quantity 2. Find the difference in the revenue compared to the equilibrium 3. Find the new demand price elasticities

Q4) Assume a market of a specific good. The demand and supply equation is as shown below: Po = 70 – 3Q0 Ps = 5 + 20s The demand price elasticities is inelastic. From the firms' perspective, the revenue would be higher if price increases. Let's assume that the market is currently not at the equilibrium with the market price being higher by 2 units than the equilibrium price. 1. Find the market quantity 2. Find the difference in the revenue compared to the equilibrium 3. Find the new demand price elasticities

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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