Consider the market for jet fuel in a remote regional airport. The domestic demand and supply curves
Question:
Consider the market for jet fuel in a remote regional airport. The domestic demand and supply curves are given as (QS are gallons in thousands):
P = 55 – 3 QD P = 5 + 7 QS.
a. What is the market equilibrium price and quantity?
b. If the government imposes a price ceiling of $28, what will be the shortage of jet fuel at the airport?
c. What price floor would yield a surplus of 5,000 gallons of fuel?
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a The market equilibrium price and quantity is the point where the quantity demanded QD equals the q...View the full answer
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