Answer to Question #188233 in Economics for Ayesha

Question

A manufacturing market is initially at equilibrium at equilibrium price and quantity.suddenly the demand of its products increases by 10% while supply of products decrease by 15% . Find its new equilibrium price, equilibrium point and equilibrium quantity.

Answer 1

$$Q_D^/=1.1Q_d$$

$$Q_S^/=0.85Q_s$$

$$1.1Q_D=0.85Q_s$$

$$Q_D=0.77Q_S$$

$$a-bp=0.77(c+dp)$$

$$a-bp=0.77c+0.77dp$$

$$0.77dp+bp=a-0.77c$$

$$p=\frac{a-0.77c}{0.77d+b}$$