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Daniel [21]
3 years ago
14

Suppose the current price of a good is $55. At this price, the quantity supplied is 165 units, and the quantity demanded is 240

units. For every $1 increase in price, the quantity supplied increases by 5 units and the quantity demanded decreases by 10 units. At the current price, the quantity demanded isgreater than the quantity supplied. This means that the market is currently experiencing asurplus . In order to adjust, the market price willincrease until the quantity demanded and quantity supplied are equal. The result is an equilibrium quantity of and an equilibrium price of $ .
Business
1 answer:
inysia [295]3 years ago
3 0

Answer:

190

$60

Explanation:

Equilibrium price is the price at which quantity demanded equals quantity supplied

Equilibrium quantity is the quantity at which quantity demanded equals quantity supplied

Let x = change in quantity supplied

the following equations can be derived from the question

165 + 5x = total change in quantity supplied

240 - 10x = total change in quantity demanded

At equilibrium, quantity demanded equals quantity supplied. So,

165 + 5x = 240 - 10x

collect like terms and solve for x

15x = 75

x = 5

this means that quantity supplied would have to increase 5 times : 165 + 5(5) = 190

and quantity demanded would have to decrease 5 times : 240 + 10(5) = 190

equilibrium quantity is 190

equilibrium price = $55 + 1(5) = $60

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Sales and Production Budgets Ultimate Audio Company manufactures two models of speakers, U500 and S1000. Based on the following
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<u>Production Budget </u>

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                                                                   Model U500     Model S1000

Expected Units to be Sold                           300,000             225,000

Add Desired Closing Inventory                      30,000                15,000

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Less Desired Opening Inventory                  (25,000)              (10,000)

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<em>Note : I have attached the complete question as images below !</em>

A Sales Budget shows the Total Expected Revenue from sale of budgeted units.

     Total Revenue = Total Expected Units Sales x Selling Price Per Unit

A Production Budget shows the number of units to be produced to meet the Sales and Inventory targets

     Total Production = Expected Sales + Desired Closing Inventory - Desired Opening Inventory

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