Equilibrium Price and Quantity Pd = a + Bex alpha 50 beta -0.0166667 PS = 2+89x lambda 33.333333 Equilibrium Condition: P. = P delta 0.0111111 For the demand and supply equations above and parameters to the right, 17) Equilibrium Price 2 18) Equilibrium Quantity 2 19) Maximum Total Surplus 2 20) Dead Weight Loss when government restricts output to be Q=400 pa = aeBox alpha 69.780621 Ps = he62x beta -0.0006667 lambda 30.326533 Equilibrium Condition: P. = P,s delta 0.001 For the demand and supply equations above, 2 21) Equilibrium Price 2 22) Equilibrium Quantity Price & Quantity Adjustments to Demand or Supply Shocks Consider a market in equilibrium wherein a +18% shock to demand occurs. Assume also that the supply function is highly elastic (Es = 5) and the demand function is also highly elastic (Ed = -7). 3 23) What is the approximate % change in equilibrium price? 3 24) What is the approximate % change in equilibrium quantity? Consider a market in equilibrium wherein a -20% shock to supply occurs. Assume also that the demand function is highly inelastic (Ed = -0.75) and the supply function is also highly elastic (Es = 3.25). 3 25) What is the approximate % change in equilibrium price? 3 26) What is the approximate % change in equilibrium quantity