Step by Step Solutions

(Steps Shown) [Market Equilibrium - II] The demand and supply functions for products #1 and #2 are: Demand \#1 p_1=2000-3q_1-2q_2 , \#2 p_2=2800-q_1-4q_2

Question: [Market Equilibrium - II]

The demand and supply functions for products #1 and #2 are:

Demand

\(\begin{aligned} & \#1\,\,\,\,\,{{p}_{1}}=2000-3{{q}_{1}}-2{{q}_{2}} \\ & \#2\,\,\,\,{{p}_{2}}=2800-{{q}_{1}}-4{{q}_{2}} \\ \end{aligned}\)

Supply

\(\begin{aligned} & \#1\,\,\,\,\,{{p}_{1}}=100+2{{q}_{1}}+{{q}_{2}} \\ & \#2\,\,\,\,{{p}_{2}}=200+3{{q}_{1}}+2{{q}_{2}} \\ \end{aligned}\)
  1. Find the prices and quantities at equilibrium.
  2. If demands change to those below, with the same supply functions find the new equilibrium point

Demand

\(\begin{aligned} & \#1\,\,\,\,\,{{p}_{1}}=2270-3{{q}_{1}}-2{{q}_{2}} \\ & \#2\,\,\,\,{{p}_{2}}=2890-{{q}_{1}}-4{{q}_{2}} \\ \end{aligned}\)

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