Note: Symbols are switched in the two modes to avoid confusion (a, b, c, d to , , y, ).

Dyamic Model:

Qd=-P (, >0)

Qs=-y+P (y, >0)

Equilibrium price should be:

P*=+y

+ (=some positive constant)

Static Model:

Qd=a-bP

Qs=-c+dP

The model can be further reduced to:

a-bP=-c+dP

of, after subtracting )a+dP) from both sides of the equation and multiplying through by -1,

(b+d)P=a+c

Value of P*= a+c

b+d

Question: What specific new feature id responsible for transforming the static model into the dyamic model?