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Demand and Supply Curves.
The following relations describe monthly demand and supply relations for dry cleaning services in the metropolitan area:
QD = 500,000 - 50,000P (Demand)
QS = -100,000 + 100,000P (Supply)
where Q is quantity measured by the number of items dry cleaned per month and P is average price in dollars.
A. At what average price level would demand equal zero?
B. At what average price level would supply equal zero?
C. Calculate the equilibrium price/output combination.
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