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Suppose the demand and supply curves for a product are given by
QD = 250 - P
QS = -50 + 1.5P
a. Find the equilibrium price and quantity.
b. If the current price of the product is $100, what is the quantity demanded and the quantity supplied? How would you describe this situation, and what would you expect to happen in this market?
c. If the current price of the product is $150, what is the quantity demanded and the quantity supplied? How would you describe this situation, and what would you expect to happen in this market?
d. Suppose the demand changes to QD = 300 - P . Find the new equilibrium price and quantity and indicate whether the change in demand indicate an increase or a decrease in Demand and why?
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