Here a 1250 and m d 0 25 from supply s 500 n 5 see

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Here a = 1250 and m d = 0 . 25. From supply , S = - 500, N = 5, see the formula sheet, IS P = - S N + 1 N Q = - ( - 500) 5 + 1 5 Q = 100 + 0 . 2 Q. Here b = 100 and m s = 0 . 2. NSB = ( a - b ) 2 2( m d + m s ) = (1250 - 100) 2 2(0 . 25 + 0 . 2) = 1150 2 0 . 9 = $1 , 469 , 444 . 44 . 4. A freeze in Peru causes the price of coffee to skyrocket. What happens in the tea market in Peru? a. Tea supply will increase and the equilibrium price will go down and quantity will go up. b. Tea supply will increase and the equilibrium price will go up and quantity will go down. Tea demand will increase and the equilibrium price and quantity both will go up . d. Tea demand will decrease and the equilibrium price and quantity will both go up. e. Tea supply will decrease and the equilibrium price and quantity will both go up. Here coffee and tea are consumption substitute. When coffee price goes up, tea demand goes up. Therefore, equilibrium quantity and price of tea will go up. 5. If the price of hot dog decreases, which of the following changes to occur in the hot dog bun market? Both the equilibrium quantity and price of hot dog bun will go up . b. Both the equilibrium quantity and price of hot dog bun will go down. c. Equilibrium quantity will go up and price will go down. d. Equilibrium quantity will go down and price will go up. e. The supply of hot dog bun will go up. Hog dog and hot dog bun are a pair of consumption complement, when price of hot dog decreases, the demand for hot dog bun increases. Therefore, both equilibrium quantity and price of hot dog bun will increase.
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