Question
In: Economics
The European Union (EU) and United States (US) demand and supply equations for corn are: QDEU...
The European Union (EU) and United States (US) demand and supply equations for corn are: QDEU = 70 – 2 PEU QSEU = 20 + 3PEU QDUS = 130 – 3PUS QSUS = 30 + PUS where QD and QS represent the quantities demanded and supplied in both countries (in billions of tons) and P represents the Dollar price per ton of corn in each country. a. Graph the US and European Union supply and demand curves for corn (what are the intercepts?). b. Determine the US and European Union equilibrium prices in the absence of trade. c. Find the surplus (or shortage) in both countries at the price of $ 20.
Solutions
Expert Solution
a) Intercepts are found by replacing the x-axis variable(quantity) by 0 and then by replacing the y-axis variable (price) by 0.
b) for equilibrium equate demand with supply for each country.
After finding the equilibrium price put it back in any one equation
(demand or supply, I have used Demand) to find out the equilibrium
quantity.
Rahul Sunny answered 2 years agoRelated Solutions
2. The European Union (EU) and United States (US) demand and supply equations for corn are:...
2. The European Union (EU) and United States (US) demand and
supply equations for corn are:
QDEU = 70 – 2
PEU
QSEU = 20 + 3PEU
QDUS = 130 – 3PUS QSUS = 30 + PUS
where QD and QS represent the quantities demanded and supplied
in both countries (in billions of tons) and P represents the Dollar
price per ton of corn in each country.
a. Graph the US and European Union supply and demand curves for
corn...
2. The European Union (EU) and United States (US) demand and supply equations for corn are:...
2. The European Union (EU) and United States (US) demand and
supply equations for corn are: QDEU = 70 – 2 PEU QSEU = 20 + 3PEU
QDUS = 130 – 3PUS QSUS = 30 + PUS where QD and QS represent the
quantities demanded and supplied in both countries (in billions of
tons) and P represents the Dollar price per ton of corn in each
country.
a. Graph the US and European Union supply and demand curves for
corn...
The European Union (EU) and United States (US) demand and supply equations for corn are: QDEU...
The European Union (EU) and United States (US) demand and supply
equations for corn are: QDEU = 70 – 2 PEU QSEU = 20 + 3PEU QDUS =
130 – 3PUS QSUS = 30 + PUS where QD and QS represent the quantities
demanded and supplied in both countries (in billions of tons) and P
represents the Dollar price per ton of corn in each country.
Now assume that there is free trade between the European Union
and US.
d....
2. The European Union (EU) and United States (US) demand and supply equations for corn are:...
2. The European Union (EU) and United States
(US) demand and supply equations for corn
are:
QDEU =70–2PEU QSEU =20+3PEUQDUS = 130 – 3PUS QSUS = 30 + PUS
where QD and QS represent the quantities demanded and supplied
in both countries (in billions of tons) and P represents the Dollar
price per ton of corn in each country.
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