1.

Point B:

Point C:

Point D:

2 .a)The equilibrium price is: 5$

Curve
The equilibrium quantity is : 175
30
b)The effect of a price ceiling of 3$ placed on 25
this market makes the shortage: the amount of 20
excess demand is : 15
10
Qs – Qd =100-220 = -120 5
c)The effect of a price ceiling of 7$ placed on 0
0 2 4 6 8 10 Q
this market makes surplus : the amount of
excess demand is :
Curve
Qs – Qd =220 - 100= 120
3. a)
d)If price in this market is $7, Suppliers need to
reduce product prices from $7 to $5 to stimulate b ) P = 25- 0,5Q  Q = 50-2Q (Q)’ = 2
demand, or reduce product production from 220 P = 10  Q=30 E = %Q/%E = (ΔQ1/ ΔQ) / (ΔP/P) = (Q)’p x P/Q
to 175 to avoid surplus.
4.a) We have the equation: => E=2 x 10/30= 0,67

10P=170 + 3Q c) The price elasticity of demand fall at $10 in inelastic demand.

 P= 17+0,3Q d) If my goal is to maximize total revenue, i will increase the price if i

amcurrently charging $10?
 P’Q = 0,3

E = %ΔQ/%ΔP = (ΔQ/Q)/( ΔP/P)

= (1/P’Q )x(P/Q) = 1/0,3 x 4/20 5)

= 0,67 -C
b) Based on the elasticity of supply in part a, if
price increases by 10%, quantity supplied change :
0,67 x 10%= 6,7% ECO111 Microeconomics
c) Class: MKT1609
i) does not change Name:Nguyen Le Phuong Uyen
ii) more elastic Email
iii) more elastic to:uyennlphs169003@fpt.edu.vn