question archive Suppose the market for kittens adoption centre can be described by the following equations: Demand equation: Qd = 100 - 20P Supply equation: Qs = 130 + 2P Calculate the equilibrium price (P) and quantity (Q) of kittens
Suppose the market for kittens adoption centre can be described by the following equations: Demand equation: Qd = 100 - 20P Supply equation: Qs = 130 + 2P Calculate the equilibrium price (P) and quantity (Q) of kittens
Subject:EconomicsPrice:2.87 Bought7
Suppose the market for kittens adoption centre can be described by the following equations:
Demand equation: Qd = 100 - 20P
Supply equation: Qs = 130 + 2P
Calculate the equilibrium price (P) and quantity (Q) of kittens. Remember that a negative price of kittens is not allowed. How many kittens will be adopted by humans and how many will be "strays?"
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Answer:
Equilibrium Price is where Quantity demanded (Qd) = Quantity supplied (Qs)
Price can't be negative. at minimum it can be zero.
100 kittens will be adopted by humans and
30 will be "strays"
Step-by-step explanation
Equilibrium Price is where Quantity demanded (Qd) = Quantity supplied (Qs)
According to question -
100 - 20P = 130 + 2P
=> 100 - 130 = 2P+20P
=> -30 = 22 P
=> P= -30/22
=> P = - 1.36
But we know that Price can't be negative. at minimum it can be zero.
So if we let P= 0, Qd= 100 - 20P => Qd = 100
Qs= 130 + 2P => Qs = 130
so excess supply = Qs- Qd = 130-100 = 30
100 kittens will be adopted by humans and
30 will be "strays"
