Suppose the demand curve for apples is P=800-2Qd. Where P is the price per pound(in cents) of an apple and Qd is the quantity demanded per year(in millions of pounds). Suppose that the supply curve for apples is: p=-300+3Qs. Where P is the price per pound(in cents) of an apple and Qs is the quantity supplied per year(in millions of pounds).(adsbygoogle = window.adsbygoogle || []).push({});

a) Calculate the equilibrium quantity and price of apples.

800-2Q=-300+3Q

1100=5Q

Q=220

Demand: 220=800-2Qd

-580=-2Qd

Qd=290

Supply: 220=-300+3Qs

520=3Qs

Qs=173

Please check if my calc are correct =)

b)Suppose the government puts in a price floor of $4.50 per pound on apples. How big will the surplus of apples be? Show your work.

I'm not sure about this question...would you just make the $4.50 equal to one of the above equations?

c)Suppose the government puts in a price ceiling of $2.50 per pound on apples. How big will the shortage of apples be? Show your work.

.....and same thing for this one?

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# Economics - demand curve, price and equilibrium

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