Suppose the demand for shoes is given by Qd = 40 – 5P and the supply for shoes is given by Qs = 10P – 20, where P = price (per shoes). Graph the supply and demand schedules for shoes. What is the equilibrium price and equilibrium quantity using the equations provided? What would happen if suppliers set the price of shoes at $8? Illustrate this problem Explain the market adjustment process of the problem in part (iii)

Suppose the demand for shoes is given by Qd = 40 – 5P and the supply for shoes is given by Qs = 10P – 20, where P = price (per shoes). Graph the supply and demand schedules for shoes. What is the equilibrium price and equilibrium quantity using the equations provided? What would happen if suppliers set the price of shoes at $8? Illustrate this problem Explain the market adjustment process of the problem in part (iii)

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter4: Supply And Demand: An Initial Look

Section: Chapter Questions

Problem 2TY

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Question

100%

Suppose the demand for shoes is given by Qd = 40 – 5P and the supply for shoes is given by Qs = 10P – 20, where P = price (per shoes).

Graph the supply and demand schedules for shoes.
What is the equilibrium price and equilibrium quantity using the

equations provided?
What would happen if suppliers set the price of shoes at $8? Illustrate

this problem
Explain the market adjustment process of the problem in part (iii)