Question: An item is initially sold at a price of $p per unit. Over time, market forces push the price toward the equilibrium price, $p*, at which supply balances demand. The Evans Price Adjustment model says that the rate of change in the market price, $p, is proportional to the difference between the market price and the equilibrium price.

a.) Write a differential equation for \(p\) as a function of \(t\).

b.) Solve for \(p\).

c.) Sketch solutions for various different initial prices, both above and below the equilibrium price.

d.) What happens to as \(t \rightarrow \infty ?\)

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