There are two closely related crops,X and Y,with the following demand functions Q_X= 180 - 2P_X + P_Y and Q_Y = 150 + P_X - P_Y where Q_X is the quantity of X,P_X is the price of X,Q_Y is the quantity of Y,and P_Y is the price of Y.These two crops are grown in two widely separated countries so there is no interrelationship between the supply curves.The short-run perfectly inelastic supply for X is 200 while the short-run perfectly inelastic supply for Y is 100.In equilibrium,the prices are

Question

Quizplus · Accepted Answer

Given the perfectly inelastic supply of 200 for X and 100 for Y, we set the quantities in the demand functions equal to these values and solve for the prices. For X: 200 = 180 - 2P_X + P_Y, and for Y: 100 = 150 + P_X - P_Y. Solving these equations simultaneously gives P_X = 30 and P_Y = 80, indicating equilibrium prices.

There Are Two Closely Related Crops,X and Y,with the Following