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Solve the model for both equilibrium prices and both equilibrium quantities. Model: d1 = 10 2 1 + 2 (1) s1 = 2 + 3
Solve the model for both equilibrium prices and both
equilibrium quantities.
Model:
d1 = 10 21 + 2 (1)
s1 = 2 + 31 (2)
d1 s1 = 0 (3)
d2 = 15 + 1 2 (4)
s2 = 1 + 22 (5)
d2 s2 = 0 (6)
1. Which equations in the model are equilibrium conditions? Behavioural
equations?
2. How many endogenous variables are there in the model?
3. Solve the model.
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