Please show work Use the information listed below to solve parts a through h. Su
ID: 1146399 • Letter: P
Question
Please show work
Use the information listed below to solve parts a through h. Suppose that the demand and price for a certain model of a youth wristwatch are related by the following equation p = D(q)-28-225q where p is the price (in dollars) and q is the quantity demanded (in hundreds). Find the price at each level of demand. Answer parts a through d a. Find the price when the demand is 0 watches The price when the demand is 0 watches is $ 28 b. Find the price when the demand is 400 watches. The price when the demand is 400 watches is $ 19 c. Find the quantity demanded for the watch when the price is $10. At a price of S10, the demand is for 800 watches. d. Graph p 28-2.25q. Choose the correct graph below OC. OD. 20 20 20 20 Suppose the price and supply of the watch are related by the following equation S(q) = 1.25q where p is the price (in dollars) and q is the quantity supplied (in hundreds) of watches. Answer parts e through g e. Find the quantity supplied at a price of S0. At a price of S0, the supply is 0 watches.Explanation / Answer
A) The demand function is p = 28 - 2.25q. When demand q is 0, price is p = 28 - 2.25*0 = $28
B) When demand q is 400, price is p = 28 - 2.25*4 = $19.
C) When the price is 10, we have 10 = 28 - 2.25q or 2.25q = 18. This gives q = 800 or 8 in hundreds
D) Graph of the demand function will have vertical intercept of 28 (When q = 0, the value of p is 28) and horizontal intercept of 12.44. Here the first graph in part A is correct because it fits the intercepts
E) Supply function is p = 1.25q. When the price is 0, quantity supplied is 0.
F) When price is 17, quantity supplied is 17 = 1.25q or q* = 13.6 of 1360 in hundreds
G) The vertical intercept is 0. The graph will be similar to the one in option A because it matches both demand and supply equations.
H) Equilibrium occurs when demand and supply are equal
28 - 2.25q = 1.25q
28 = 3.5q
q* = 28/3.5 = 8 or 800 watches and price is p = 1.25*8 = $10.