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In: Economics

Consider an economy where there are 10 consumers with identical demand function: q=100-2p Suppose that aggregate...

Consider an economy where there are 10 consumers with identical demand function:

q=100-2p

Suppose that aggregate supply is given by

QS=4p-10

  1. How would your answer change if aggregate supply were perfectly elastic at price 20?
  2. How would your answer change if the aggregate supply were perfectly inelastic at Q=500?

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Expert Solution

Rahul Sunny answered 2 years ago
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