1. Business
  2. Economics
  3. 4 suppose the supply curve for apples is given by...

Question: 4 suppose the supply curve for apples is given by...

Question details

4. Suppose the supply curve for apples is given by QS -2P, where QS is the quantity offered for sale when the prices is P. Also, suppose the demand curve for apples is given by QD- 182-4PI, where QD is the quantity of apples demanded when the price is P and the level of income is erw a) Find the equilibrium P and Q when I -6 b) Find price-elasticity of demand at the equilibrium when 6, and give an interpretation in terms of percents and classify the elasticity (elastic or inelas ticc) Find the income-elasticity of demand at the equilib- rium when I 6, and give an interpretation in terms of percents. What type of good is this (normal, infe- rior, luxury) el d) Find the equilibrium P and Q as a function of I e) Find the price elasticity of demand as a function of P and I and determine when this is unitary elastic. f) Find the income-elasticity in terms of P and I

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution