ECN211 L6 Supply (continued)_BB

# ECN211 L6 Supply (continued)_BB - ECN 211 Macroeconomic...

This preview shows pages 1–7. Sign up to view the full content.

1 ECN 211 Macroeconomic Principles L6: Supply and Equilibrium

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
Algebra- Supply Curve Simple:  Qs = 2P-100 Ex: If price is \$150 then quantity supplied is? A) Qs = 2(150)-100=200 units Note: as P is on the vertical axis we usually look at  (inverse) supply curves: P = 50+0.5Qs The 50 (or the y-axis intercept) is the minimum amount  firms will pay 2
Translating into table form 3 Price Quantity Supplied \$350 600 \$300 500 \$250 400 \$200 300 \$150 200 \$100 100 \$50 0 Remember: P = 50+0.5Qs

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
Translating into a  Diagram 4 Price Quantity Supplied Supply \$300 \$50 500 600 Remember: P = 50 +0.5Qs \$350
Complicated: Supply for good X: Qs x  = 0.5P  - 0.25Wage  + 0.6Prod - 100 If the price of good X is \$400, wages are \$100 and  prductivity is 40 what is the quantity supplied of good X? Qs x  = .5(400) - .25(100) + .6(40) -100 Qsx = 200 – 25 + 24 – 100 Qsx=99 5

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
6 Equilibrium In equilibrium, quantity demanded equals quantity supplied \$5 20 Price Quantity \$10 10 S D 15 \$7.50 Equilibrium
This is the end of the preview. Sign up to access the rest of the document.

## This note was uploaded on 09/19/2011 for the course ECN 211 taught by Professor Kingston during the Fall '08 term at ASU.

### Page1 / 20

ECN211 L6 Supply (continued)_BB - ECN 211 Macroeconomic...

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online