Mgnt 6005 – Homework Chptr 3
P3.1
Demand and Supply Curves.
The following relations describe monthly
demand and supply conditions in the metropolitan area for recyclable
aluminum
Q
D
= 317,500  10,000P
(Demand)
Q
S
= 2,500 + 7,500P,
(Supply)
where Q is quantity measured in pounds of scrap aluminum and P is price in
cents.
Complete the following table:
Price
(1)
Quantity
Supplied
(2)
Quantity
Demande
d
(3)
Surplus (+) or
Shortage ()
(4) = (2)  (3)
15
4
16
17
18
19
20
P3.1
SOLUTION
Price
(1)
Quantity
Supplied
(2)
Quantity
Demande
d
(3)
Surplus (+) or
Shortage ()
(4) = (2)  (3)
15
4
115,000
167,500
52,500
16
122,500
157,500
35,000
17
130,000
147,500
17,500
18
137,500
137,500
0
19
145,000
127,500
17,500
20
152,500
117,500
35,000
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View Full DocumentP3.2
Demand and Supply Curves.
The following relations describe monthly
demand and supply relations for dry cleaning services in the metropolitan
area:
Q
D
= 500,000  50,000P
(Demand)
Q
S
= 100,000 + 100,000P
(Supply)
where Q is quantity measured by the number of items dry cleaned per month
and P is average price in dollars.
A.
At what average price level would demand equal zero?
B.
At what average price level would supply equal zero?
C.
Calculate the equilibrium price/output combination.
P3.5
Demand Function.
The Creative Publishing Company (CPC) is a coupon
book publisher with markets in several southeastern states.
CPC coupon
books are either sold directly to the public, sold through religious and other
charitable organizations, or given away as promotional items.
Operating
experience during the past year suggests the following demand function for
CPC
=
s coupon books:
Q = 5,000  4,000P + 0.02Pop + 0.375I + 1.5A,
where Q is quantity, P is price ($), Pop is population, I is disposable income
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 Spring '11
 MaxNorth
 Supply And Demand, industry supply curve, YAKIMA

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