Question: The demand for a commodity is given by Q Bo+BP + 1, where Q denotes quantity, P denotes price, and u denotes factors other than

The demand for a commodity is given by Q Bo+BP + 1, where Q denotes quantity, P denotes price, and u denotes factors other than price that determine demand. Supply for the commodity is given by Q-yu+yP+ v, where v denotes factors other than price that determine supply. Suppose that u and v both have a mean of zero, have variances and o, and are mutually uncorrelated.

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