In the town of Greenville, there are two main products that people care about: Bottled Milk for nutrition, and Electricity so they can refrigerate their milk and open the bottles at night. The third thing the citizens care about is Clean Air so they can enjoy their milk outside in Spring.

Bottled Milk Market 

Demand for milk

Qd1 = -10P + 150 

Qd2 = -5P + 300

Supply for milk Qs1 = 10P - 100

Qs2 = 5P - 50

a) Find Qd, the demand function for this market (5 Points).

b) Find Qs, the supply function for this market.

c) Find the competitive market equilibrium Price PC and Quantity QC.

d) Graph the Supply and Demand Function and indicate the intercepts, QC and PC.

e) - Calculate the Consumer Surplus, and Producer Surplus, AND highlight those areas in the graph as CS and PS respectively.

Answer rating: 100% (QA)

a The demand function for this market is the sum of the individual demand functions Qd Qd1 Qd2 ... View the full answer