12. Consider the market for broadband Internet service. Demand is given by: Q D
ID: 1133065 • Letter: 1
Question
12. Consider the market for broadband Internet service. Demand is given by: QD = 224 4P. Supply is given by: QS = 12.5P - 150. In both demand and supply, Q is the quantity of services (in hundreds) and P is the price per month. What is the equilibrium quantity of broadband Internet service?
12. Consider the market for broadband Internet service. Demand is given by: QD = 224 4P. Supply is given by: QS = 12.5P - 150. In both demand and supply, Q is the quantity of services (in hundreds) and P is the price per month. What is the equilibrium quantity of broadband Internet service?
16,250 13,333 12,400 31,250Explanation / Answer
equilibrium quantity of broadband Internet service is when QS=QD
224 4P=12.5P - 150
16.5P=374
P=374/16.5=22.6667 is equlibrium price
so the equilibrium quantity of broadband Internet service=(12.5*22.6667-150)*100=13,333
the above is answer..
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