Question

. Equilibrium: If the number of persons who attend the club meeting this week is X, then the number of people who will attend next week is 80 0.20X. What is a long- run equilibrium attendance for this club

Answer 1

100

Explanation:

In economics, for a firm to earn optimum profits, it is important that it achieves a long run equilibrium. We can transfer the same to the case here that for the club to achieve optimum attendance, it must achieve long- run equilibrium attendance.

The condition for Long Run Equilibrium is that:

Club meeting attendance this week = Club meeting attendance next week

X = 80 + 0.20X

X - 0.20X = 80

X = 80/0.8

X = 100.

The long- run equilibrium attendance for this club is 100.