The estimated monthly Canada demand function for bananas is Q = 120 - 50p + 64pa...

 

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The estimated monthly Canada demand function for bananas is Q = 120 - 50p + 64pa where p is the price of bananas and pa is the price of apples, a substitute for bananas. The supply function for bananas is Q = 110 + 40p. The initial price of apples is $1.25 per lb. Using algebra, determine the initial equilibrium price and quantity of bananas, and then determine how price and quantity change if the price of apples increase to $1.5 per lb. Using the demand and supply function for bananas market to determine how the equilibrium price and quantity change when a $0.2 per lb. specific tax is imposed on this market. In 2018, a popular smartphone brand faced a major scandal when it was revealed that their batteries were prone to exploding. As a result, many consumers became hesitant to purchase smartphones from that brand. Analyze the problem using supply-and-demand analysis, and explain the likely effects on price and equilibrium quantity. The estimated monthly Canada demand function for bananas is Q = 120 - 50p + 64pa where p is the price of bananas and pa is the price of apples, a substitute for bananas. The supply function for bananas is Q = 110 + 40p. The initial price of apples is $1.25 per lb. Using algebra, determine the initial equilibrium price and quantity of bananas, and then determine how price and quantity change if the price of apples increase to $1.5 per lb. Using the demand and supply function for bananas market to determine how the equilibrium price and quantity change when a $0.2 per lb. specific tax is imposed on this market. In 2018, a popular smartphone brand faced a major scandal when it was revealed that their batteries were prone to exploding. As a result, many consumers became hesitant to purchase smartphones from that brand. Analyze the problem using supply-and-demand analysis, and explain the likely effects on price and equilibrium quantity.

Answer rating: 100% (QA)

SOLUTION Initial equilibrium price and quantity of bananas To find the initial equilibrium price and quantity we set the quantity demanded equal to th... View the full answer