Shocks to the Equilibrium 1. Complete the sentences: The equilibrium changes only if These demand and supply curves shift if 2. The estimated monthly U.S. demand function for avocados is Q = 144 - 40p + 20pt, where pt is the price of tomatoes, a substitute for avocados. The estimated supply function is Q = 50 + 15p. The initial price of tomatoes is $0.80. Using algebra, determine the initial equilibrium price and quantity of avocados, and then determine how price and quantity change if the price of tomatoes increases by $0.55 to $1.35.

Shocks to the Equilibrium 1. Complete the sentences: The equilibrium changes only if These demand and supply curves shift if 2. The estimated monthly U.S. demand function for avocados is Q = 144 - 40p + 20pt, where pt is the price of tomatoes, a substitute for avocados. The estimated supply function is Q = 50 + 15p. The initial price of tomatoes is $0.80. Using algebra, determine the initial equilibrium price and quantity of avocados, and then determine how price and quantity change if the price of tomatoes increases by $0.55 to $1.35.

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 12
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