In a market with perfect competition, two different goods are produced. The demand function for the respective goods is
Posted: Wed Mar 09, 2022 8:39 am
In a market with perfect competition, two different goods are
produced.
The demand function for the respective goods is given by
𝑄1 = 100 −𝑝1 + 2𝑝2
𝑄2 = 100 + 𝑝1 − 𝑝2.
If the supply functions are provided by
𝑄1 = 10 + 𝑝1
𝑄2 = 20 + 𝑝2,
how much of each product is then produced in equilibrium?
a. 𝑄1 = 120 and 𝑄2 = 180.
b. 𝑄1 = 180 and 𝑄2 = 145.
c. 𝑄1 = 100 and 𝑄2 = 100.
d. 𝑄1 = 200 and 𝑄2 = 120.
(right answer is b. but I need step by step to come to this
conclusion)
produced.
The demand function for the respective goods is given by
𝑄1 = 100 −𝑝1 + 2𝑝2
𝑄2 = 100 + 𝑝1 − 𝑝2.
If the supply functions are provided by
𝑄1 = 10 + 𝑝1
𝑄2 = 20 + 𝑝2,
how much of each product is then produced in equilibrium?
a. 𝑄1 = 120 and 𝑄2 = 180.
b. 𝑄1 = 180 and 𝑄2 = 145.
c. 𝑄1 = 100 and 𝑄2 = 100.
d. 𝑄1 = 200 and 𝑄2 = 120.
(right answer is b. but I need step by step to come to this
conclusion)