Write a two-equation system in "supply and demand form," that is, with the same variable y1 (typically, "quantity") appearing on the left-hand side:

(i) If α, = 0 or α2 = 0, explain why a reduced form exists for y1, (Remember, a reduced form expresses y, as a linear function of the exogenous variables and the structural errors.) If α1 ‰  0 and α2 = 0, find the reduced form for y2.
(ii) If α1 ‰  0, α2 ‰  0, and α, ‰  α2, find the reduced form for y1. Does y2 have a reduced form in this case?
(iii) Is the condition α1 ‰  α2 likely to be met in supply and demand examples? Explain.

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