1) If P = 3 Q s + 3 represents market supply for a competitive industry and mark

ID: 1099049 • Letter: 1

Question

1) If P = 3Qs + 3 represents market supply for a competitive industry and market demand is given by Qd = 31 - 1/3P, the equilibrium quantity is:

a. 10

b. 15

c. 20

d. 48

2) If P = 3Qs + 3 represents market supply for a competitive industry and market demand is given by Qd = 31 - 1/3P, the equilibrium price is:

a. $10

b. $15

c. $20

d. $48

3) Suppose the market demand curve for a monopolist is given by P = 50 - 10Q. Then the marginal revenue curve is given by:

MR = 25 - 10Q. MR = 25 - 20Q. MR = 50 - 5Q. MR = 50 - 20Q

1. b. 15

Qs = P/3 - 1 and Qd = 31 - P/3

At eql: Qs = Qd

=> P/3 - 1 = 31 - P/3

=> 2P/3 = 32

=> P = (32 * 3)/2 = $48

Q = P/3 - 1 = 48/3 - 1 = 16 - 1 = 15

2. d. $48

Qs = P/3 - 1 and Qd = 31 - P/3

At eql: Qs = Qd

=> P/3 - 1 = 31 - P/3

=> 2P/3 = 32

=> P = (32 * 3)/2 = $48

Q = P/3 - 1 = 48/3 - 1 = 16 - 1 = 15

3. MR = 50 - 20Q

Total revenue = price * quantity = (50 - 10Q)*Q = 50Q - 10Q^2

MR = dTR/dQ = 50 - 20Q

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