Question
Please show workings and calculations Suppose demand and supply curves in the vitamin supplements market have the following functional forms: QD = 112-4PandQS = 6P-18
Please show workings and calculations
Suppose demand and supply curves in the vitamin supplements market have the following functional forms:
QD = 112-4PandQS = 6P-18
where P is measured in dollars per bottle of vitamins.
Part (a): Suppose vitamins are initially priced at $18. Identify whether there is excess supply or excess demand, and calculate the level of excess supply or excess demand that exists in the market.
Part (b): Based on your answer to part (a), describe how the price must adjust.
Part (c): Calculate the equilibrium price and the bottles of vitamin supplement sold.
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