1.

Suppose the demand and supply curve of commodity X in a perfectly competitive market are given by:qD = 700 − pqS = 500 + 3p for p ≥ 15 = 0 for 0 ≤ p <15Assume that the market consists of identical firms. Identify the reason behind the market supply of commodity X being zero at any price less than Rs 15. What will be the equilibrium price for this commodity? At equilibrium, what quantity of X will be produced?

Answer»

Suppose the demand and supply curve of commodity X in a perfectly competitive market are given by:



qD = 700 − p



qS = 500 + 3p for p ≥ 15



= 0 for 0 ≤ p <15



Assume that the market consists of identical firms. Identify the reason behind the market supply of commodity X being zero at any price less than Rs 15. What will be the equilibrium price for this commodity? At equilibrium, what quantity of X will be produced?



Discussion

No Comment Found

Related InterviewSolutions