Business math homework

Posted on 2014-03-10 11:48:00 in Math by MICHAEL

At a price of $2400, the supply of a certain commodity is 120 units while its demand is 560 units. If the price is raised to $2700 per unit, the supply and demand will be 170 units and 410 units, respectively.



a. Determine the demand function p=f(qd) and the supply function p=f(qs), assuming them to be linear.



b. Determine the market equilibrium price and quantity.



c. If a tax of $240 per unit is imposed on the commodity, what are the new equilibrium price and quantity? What is the increase in price and decrease in quantity?

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