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You Are Given the Following Market Data for Venus Automobiles

Question 208

Essay

You are given the following market data for Venus automobiles in Saturnia.
Demand: P = 35,000 - 0.5Q
Supply: P = 8,000 + 0.25Q
where P = Price and Q = Quantity.
a.Calculate the equilibrium price and quantity.
b.Calculate the consumer surplus in this market.
c.Calculate the producer surplus in this market.

Correct Answer:

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a.Quantity = 36,000: {35,000 - 0.5Q = 8,...

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