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Suppose that the inverse demand and supply functions for natural gas are given by: P = 8 + Qs +0.1Po and P = 16 -
Suppose that the inverse demand and supply functions for natural gas are given by: P = 8 + Qs +0.1Po and P = 16 - Qd +0.1Po, where Qs and Qd are quantities of natural gas in billion cubic feet, P is the price of natural gas in USD/thousand cubic feet, and Po is the price of oil, equal to 60 USD/barrel. The equilibrium market price of natural gas is: O 16 USD/tcf O 20 USD/tcf O 18 USD/tcf O 24 USD/tcf
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Economics Today The Macro View
Authors: Roger LeRoy Miller
19th Edition
0134478762, 978-0134478760
