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Suppose there two types of consumers in the market for fidget spinners. There are 3000 Type A consumers, each of which has the following individual
Suppose there two types of consumers in the market for fidget spinners. There are 3000 Type A consumers, each of which has the following individual inverse demand curve: P=43qA (where qA is the number of fidget spinners demanded by each type A consumer, and P is the unit price of fidget spinners). There are 7000 Type B consumers, each of which has the following individual inverse demand curve: P=52qB. (a) Find and graph the equation for the fidget spinner market demand curve. (b) Suppose that the equation for the fidget spinner market supply curve is Qs=31000+2000P (where Qs is the total number of fidget spinners supplied on the market). Using the market demand curve found in part (a), solve for the equilibrium quantity and price. As well, find the price elasticity of demand at this point. (c) Now suppose a global pandemic hits, shutting down some of the factories that produce fidget spinners. As a result, at every price level 30,000 fewer fidget spinners are supplied on the market. Using the new supply curve that results from this change, as well as the demand curve found in part (a), solve for the new equilibrium quantity and price
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