Answered: ?? = 60 − 0.5?. ?? = −2 + 2?. Determine…

?? = 60 − 0.5?. ?? = −2 + 2?. Determine the new (1) quantity (2) inverse demand price and (3) inverse demand quantity if a subsidy of $10 is paid on Chinese coal?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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?? = 60 − 0.5?. ?? = −2 + 2?. Determine the new (1) quantity (2) inverse demand price and (3) inverse demand quantity if a subsidy of $10 is paid on Chinese coal?

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Step 1: substitute the given equation for Q into the equation for P

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Step 2: Effect of substituting

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Step 3: adjust the inverse demand equation to account for the $10 subsidy.

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