Problem M$7-01($algo$)$

Consider a competitive market served by many domestic and foreign firms. The domestic demand for these firms product is $Q^d=700-2\mathrm{.}5P.$ The supply function of the domestic firms is $Q^{SD}=100+1\mathrm{.}5P,$ while that of the foreign firms is $Q^{SF}=250.$

Instructlons: Enter your responses for equilibrium price rounded to the nearest penny $($two decimal places$).$ Enter your responses for equilibrium quantity rounded to one decimal place.

a$.$ Determine the equilibrium price and quantity under free trade.

Equilibrium price: $

Equilibrium quantity: units

b$.$ Determine the equilibrium price and quantity when foreign firms are constrained by a $100-$unit quota.

Equilibrium price: $$|||$

Equilibrium quantity: $$ units

c$.$ Are domestic consumers better or worse off as a result of the quota?

Better off

Worse off

Neither better nor worse off

d$.$ Are domestic producers better or worse off as a result of the quota?

Worse off

Neither better nor worse off

Better off