Question
Consider a competitive market composed of two commodities X, and X with prices P and P Suppose that demand and supply functions are, q=10-2p
Consider a competitive market composed of two commodities X, and X with prices P and P Suppose that demand and supply functions are, q=10-2p +2P q=6+2p-4P 92=8-3p +2P 92=4+3p-P dp dt with dynamic adjustments = |dp = 22. Analyze the stability of the competitive equilibrium. Find =E, and dt the equilibrium prices. Draw the isoclines in the phase plane.
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Microeconomics An Intuitive Approach with Calculus
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