Question

The Organization for the Promotion of Brussels Sprouts has convinced the government of Ironia to institute a price floor on the sale of Brussels sprouts, at $8 per bushel. Demand is given by:P = 9 – Qand supply by:P = 2Q,where Q is measured in thousands of bushels.At market equilibrium, the price is $________ per bushel, and the equilibrium quantity is_______ thousand bushels.

Answer 1

$6 per bushel

3 thousand bushels

Step-by-step explanation:

The equilibrium price is the price for which the quantities demanded and supplied are the same, regardless of the price floor.

The equilibrium quantity is given by:

`P_D=P_S\\9-Q=2Q\\Q=3\ thousand\ bushels`

The equilibrium price is:

`P = 9 - Q = 9-3\\P=\$6`

At market equilibrium, the price is $6 per bushel, and the equilibrium quantity is 3 thousand bushels.