Suppose the market demand for burritos is given by Qd = 40 5P and the market

Question:

Suppose the market demand for burritos is given by Qd = 40 – 5P and the market supply for burritos is given by Qs = 10P – 20, where P = price (per burrito).

a. Graph the supply and demand schedules for burritos.

b. What is the equilibrium price and equilibrium quantity?

c. Calculate consumer surplus and producer surplus, and identify these on the graph.

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