Final answer:
The equilibrium price can be calculated by setting the quantity demanded equal to the quantity supplied. The price elasticity of demand and supply can be assessed to measure their responsiveness to changes in price. Shifts in supply and demand can cause changes in the equilibrium price and quantity. Consumer surplus analysis measures the benefit consumers receive from purchasing a good or service at a lower price than their maximum willingness to pay.
Step-by-step explanation:
The equilibrium price can be calculated by setting the quantity demanded (Qd) equal to the quantity supplied (Qs). In this case, the demand equation is Qd = 8 - 0.5P and the supply equation is Qs = 2 + 5P. By setting Qd equal to Qs, we have: 8 - 0.5P = 2 + 5P. Solving this equation will give us the equilibrium price.
The elasticity assessment refers to determining the price elasticity of demand and supply. It measures the responsiveness of quantity demanded or supplied to changes in price. By calculating the price elasticity for both demand and supply, we can assess how sensitive the demand and supply of pizza are to changes in price.
The shifts in supply and demand can be caused by various factors such as changes in consumer preferences, changes in production costs, or changes in the number of producers in the market. These shifts can lead to changes in the equilibrium price and quantity of pizza.
Consumer surplus analysis measures the benefit that consumers receive when they are able to purchase a good or service at a price lower than the maximum price they are willing to pay. By calculating the consumer surplus in the pizza market, we can assess the overall welfare of consumers.