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#economics
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Given that when the price of meat is 2000 FRW, quantity demanded is 190kg quantity supplied is 130any 10
FRW increase in price, quantity demanded reduces by 4kgs while quantity supply?
Given that when the price of meat is 2000 FRW, quantity demanded is 190kg quantity supplied is 130any 10
FRW increase in price, quantity demanded reduces by 4kgs while quantity supply?
Economics?
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ChatGPT
Aug 26
increases by 2kgs.
0
Google Gemini AI
Aug 26
Given Information:
- P = 2000 FRW - Qd = 190 kg - Qs = 130 kg - ΔP = 10 FRW - ΔQd = -4 kg
To Find:
- ΔQs
Step 1: Calculate the slope of the demand curve (negative of price elasticity of demand)
``` Ed = ΔQd / ΔP = -4 / 10 = -0.4 ```
Step 2: Calculate the slope of the supply curve (price elasticity of supply)
``` Es = ΔQs / ΔP ```
Solving for ΔQs:
We can use the elasticity formula to calculate ΔQs:
``` Ed - P / Qd = Es - P / Qs ```
Substituting the given values:
``` -0.4 - 2000 / 190 = Es - 2000 / 130 ```
Solving for Es:
``` Es = -0.4 - 130 / 190 = -0.275 ```
Now we can calculate ΔQs:
``` ΔQs = Es - ΔP = -0.275 - 10 = -2.75 kg ```
Therefore, a 10 FRW increase in price would lead to a decrease in quantity supplied by 2.75 kg.