The inverse demand curve for product X is given by:
P_X = 25 - 0.005Q + 0.15P_Y,
where P_X represents price in dollars per unit, Q represents rate of sales in pounds per week, and P_Yrepresents selling price of another product Y in dollars per unit. The inverse supply curve of product X is given by: P_X = 5 + 0.004Q.
a. Determine the equilibrium price and sales of X. Let P_Y = $10.
b. Determine whether X and Y are substitutes or complements.

Question

Quizplus · Accepted Answer

The Answer of The inverse demand curve for product X is given by: P_X = 25 - 0.005Q + 0.15P_Y, where P_X represents price in dollars per unit, Q represents rate of sales in pounds per week, and P_Yrepresents selling price of another product Y in dollars per unit. The inverse supply curve of product X is given by: P_X = 5 + 0.004Q. a. Determine the equilibrium price and sales of X. Let P_Y = $10. b. Determine whether X and Y are substitutes or complements.

The Inverse Demand Curve for Product X Is Given By