Suppose the world supply curve is p equals 20 plus 0.02 Upper Q Subscript font size increased by 1 s , and the demand curve of other countries of the world is p equals 80 minus 0.02 Upper Q Subscript Upper D. The excess or residual supply function is A. Upper S Superscript r Baseline (p) equals negative 5 comma 500 plus 100 p. B. Upper S Superscript r Baseline (p) equals negative 6 comma 000 plus 100 p. C. Upper S Superscript r Baseline (p) equals negative 5 comma 000 plus 100 p. D. Upper S Superscript r Baseline (p) equals negative 3 comma 900 plus 100 p. The excess or residual supply at a price of $60 is

Question

Maci Baldwin

Business

24 November, 09:12

Suppose the world supply curve is p equals 20 plus 0.02 Upper Q Subscript font size increased by 1 s , and the demand curve of other countries of the world is p equals 80 minus 0.02 Upper Q Subscript Upper D. The excess or residual supply function is A. Upper S Superscript r Baseline (p) equals negative 5 comma 500 plus 100 p. B. Upper S Superscript r Baseline (p) equals negative 6 comma 000 plus 100 p. C. Upper S Superscript r Baseline (p) equals negative 5 comma 000 plus 100 p. D. Upper S Superscript r Baseline (p) equals negative 3 comma 900 plus 100 p. The excess or residual supply at a price of $60 is

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Answers (1)

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Zander Farmer · Answer 1

Residual supply = Quantity supplied - Quantity demanded = (p - 20) / 0.02 - (80 - p) / 0.02

= (p - 20 - 80 + p) / 0.02 = (2p - 100) / 0.02 = 100p - 5000

So, Excess or residual supply function is: A) Sr (p) = - 5000 + 100p

At price of $ 60, Excess supply = - 5000 + 100 (60) = - 5000 + 6000 = 1000