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View Full Version : find the equilibrium solution for this model: Qd = 3 - P^2, Qs = 6P - 4 and Qd=Qs


asadullahfcc
Nov 12, 2011, 12:16 PM
Please help me to solve this model..

ArcSine
Nov 13, 2011, 06:28 AM
To say that Q_d = Q_s is equivalent to saying Q_d - Q_s = 0

So you just need to find the p that satisfies 3/ -/ p^2/ -/ 6p/ +/ 4/ =/ 0

Tip: This quadratic will give you two solutions for p, but you'll quickly see that only one makes sense in the problem, since we don't normally deal with negative prices and negative quantities in our universe :-)

After finding the equilibrium price, plug it back in to either of the demand equations to find equilibrium d.

ArcSine
Nov 13, 2011, 06:32 AM
Sorry, here's the cleaned up version...

3\ -\ p^2\ -\ 6p\ +\ 4\ =\ 0

I haven't had my coffee yet.