Question 1: Suppose that the demand and supply curve for wheat (measured in million bushels) in the US are given by QD(P)=3000-300P and Qs(P)=1900+200P, respectively. (a) Determine the equilibrium price and quantity of wheat. (b) Suppose that because of a bad harvest in another country, the demand for US wheat is increased by 1000 units (i.e., 1 billion bushels) independent of the price P. Determine the new equilibrium price and quantity.

Question 1: Suppose that the demand and supply curve for wheat (measured in million bushels) in the US are given by QD(P)=3000-300P and Qs(P)=1900+200P, respectively. (a) Determine the equilibrium price and quantity of wheat. (b) Suppose that because of a bad harvest in another country, the demand for US wheat is increased by 1000 units (i.e., 1 billion bushels) independent of the price P. Determine the new equilibrium price and quantity.

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

ChapterP2: Microeconomics Policy Issues

Section: Chapter Questions

Problem 6KC

See similar textbooks

Similar questions

In a particular market, demand and supply curves are defined by the following equations QD = 300 – 20P,QS = -540 + 40P, where P is the price per unit in pounds and QD and QS are the quantity demanded and quantity supplied, respectively. A) What is the equilibrium price and quantity? B) If a maximum price is fixed at £12, what quantity will be traded?
Price D 1 D 2 S 1 S 2 $12 5 9 19 14 $10 8 12 17 12 $8 11 15 15 10 $6 13 18 13 8 $4 16 21 11 6 $2 18 24 9 4 Refer to Table 5-1. Suppose that D2 and S1 are the prevailing demand and supply curves for a product. If the demand schedule changes from D2 to D1, then:
If the number of buyers in a market increases from 25 to 75, you would expect the equilibrium price to _____ and the equilibrium quantity to _____, holding all else constant. Group of answer choices remain the same; remain the same decrease; decrease decrease; increase increase; increase increase; decrease
Assuming a supply function of Qs = 100+100p and a demand function of Qd = 700-50p and an equilibrium price of $4 with an equilibrium quantity of 500million gallons please answer the following
The domestic supply and demand curves for hula beans are as follows: P = 50 + Q (supply) and P = 200 – Q (demand) where P is the price in cents per pound and Q is the quantity in millions of pounds. Ireland is a small producer in this market where the current price is 60 cents per pound. The Irish Government is considering a tariff of 40 cents per pound. The quantity of hula beans imported into Ireland after the tariff is A. 100B. 50C. 130D. 90
Predicting Changes in Equilibrium Price and Quantity Suppose that the market demand for farmed salmon is Qd = 12 – p and the market supply of farmed salmon is Qs = 9.6 + 0.5p – 0.2pt, where Q is the quantity of salmon in millions of tons per year, p is the price of salmon in dollars per pound, and pt is the price of tilapia in dollars per pound. The supply function demonstrates that the facilities that are used to farm salmon are also suitable for farming tilapia. a) Use a market diagram to demonstrate that the equilibrium price and quantity of salmon is implicitly a function of the price of tilapia. That is, show how a change in the price of tilapia will impact the market for farmed salmon. (No need to use numbers here, just sketch and explain.) b) Using the supply and demand functions, derive the relationship between the price of tilapia and the equilibrium price and quantity of salmon. You should ultimately calculate and . Check your work by calculating the impact of an increase in…
Suppose that the demand and supply curves for green peas are given by QD = 10 – 8P and QS = 2P, where P is the price per pound and Q is measured in thousands of pounds. If the price per pound of peas is $0.50, the market _____, so the price will _____. has excess demand of 3,000 pounds; rise has excess supply of 1,000 pounds; fall is in equilibrium; remain unchanged has excess demand of 5,000 pounds; rise
Suppose that the cost of crude oil decreases from $25 to $20 for each barrel of heating oil produced. Assuming that the rest of the determinants of supply and demand for heating oil remain equal to their initial values, the market will eventually reach a new equilibrium price of per barrel.
A survey by Namibian statistics agency indicated that kapana is Namibian favourite. For each of the following, graphically indicate the possible effects on demand, supply or both as well as equilibrium quantity of kapana. (a) a severe drought in Namibia causes farmers to reduce the number of cattle in their herds by a third-quarter of their stock . These farmers supply need that is used for kapana meat . (b) a new report by the veterinary council of Namibia reveals that kapana does in fact have significant health benefits (C) the discovery of cheaper animal feed by Neudamm Bush-to-feed that lower the price of cattle (d) New technology that lower cattles cost of producing
Which of the ff. statements is true with regards to the supply of palay? A. Advancement in rice technology will shift the supply curve of rice to the right B. Government subsidy on the cost of inputs for rice farmers will shift the supply curve of rice to the right C. Increase in the income from other crops will cause the rice farmers to reallocate some resources away from rice production , thus, the supply curve of rice will shift to the left D. All are true
If the demand and supply curves for a commodity are defined as follows, Qd=200-0.6(p) Qs=80+1.4(p) What would be the best option to represent the equilibrium price and equilibrium quantity
A manufacturing business can supply 60 plasma TV sets per month at a price of $280 per set, or sell 140 plasma TV sets if the price is $370 per set. A group of retailers will buy 80 plasma TV’s if the price is $350 per pair and 120 plasma TV’s if the price is $300 per set. Given that the demand and supply functions must be linear: Find the linear equations representing both demand and supply Find the point of market equilibrium (number of TVs: q) and the price per unit (p) at that point.