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:3.87 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"
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"
