Suppose that Fiat
Chrysler estimates their NORMAL DEMAND CURVE to be:
Qd = 300,000 – 7.0P

 

                              
i.     Suppose
that Fiat Chrysler knows that their SUPPLY CURVE is:
Qs = -479,218 + 28.19P,
Note that the intercept is NEGATIVE in this case. Given these two curves,
and that in equilibrium, Qd
= Qs determine the
markets equilibrium PRICE and equilibrium QUANTITY. (4 Marks)

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