Guys I am stumped I just can't figure this out! Help! And explain please!
Suppose the demand curve for a good is given by the equation P = 200 - 1/2 Q and the supply curve is given by the equation P = 50 + 1/4 Q, where P represents the price of the good (measured in dollars per unit) and Q represents the quantity of the good.(measured in units per week).
(I) Find the equilibrium price and quantity for this market.
(ii) Suppose quantity demanded for the good rises by 10 units at every possible
price while at the same time quantity supplied rises by 5 units at every possible
price. Find the new equilibrium price and quantity in this market.
(iii) Given the change in demand, how large would the rise in supply need to be
(given the same 10 unit rise in demand) in order for the price to decrease instead
of increasing as in part (iii)?
(iv) Suppose the government imposes a sales tax of $9 per unit on this good. Find
the new formula for the demand curve, the new equilibrium quantity, the posttax
price received by suppliers, and the post-tax price paid by demanders.
As in what? Any ideas?
