
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Transcribed Image Text:Use the following general linear supply function:
Qs = 40+6P-8P, +10F
where Qe is the quantity supplied of the good, Pis the price of the good, P/is the price of an input, and Fis the number of firms producing
the good. Suppose P/= $40, F= 50, and the demand function is Qd 700-6P, then if government sets a price of $50 what will be the
result?
Multiple Choice
a shortage of 120
a surplus of 120
a shortage of 160
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