Question
Suppose that the demand for sugar packets is given by Q1=10-2P1+P2;andthe demand forStaviapackets, a sugar substitute is Q2=10 - 2P2 + P1with P1 being the
Suppose that the demand for sugar packets is given by Q1=10-2P1+P2;andthe demand forStaviapackets, a sugar substitute is Q2=10 - 2P2 + P1with P1 being the price of a sugar packetand P2 the price of aStaviapacket.
If the baker has only 5 packets each of sugar andstavia,
a)solve for the equilibrium P1, P2.
b)Explain why this is a general equilibrium problem.
Hint: treat baker's collection as supply.
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Quantitative Methods For Business
Authors: David Anderson, Dennis Sweeney, Thomas Williams, Jeffrey Cam
11th Edition
978-0324651812, 324651813, 978-0324651751
