Consider the market for a Procter and Gamble biodegradable detergent. Suppose that market demand is Q_D = 120 - 3P, and market supply is Q_S = -50 + 2P, where P is the price per case and Q is the quantity in thousands per week.
a. Find equilibrium quantity and price.
b. What is the value of consumer surplus (CS) and producer surplus (PS) at equilibrium?
c. If each case of detergent were sold at $30, determine the amount of the shortage or surplus that would result.

Question

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The Answer of Consider the market for a Procter and Gamble biodegradable detergent. Suppose that market demand is Q_D = 120 - 3P, and market supply is Q_S = -50 + 2P, where P is the price per case and Q is the quantity in thousands per week. a. Find equilibrium quantity and price. b. What is the value of consumer surplus (CS) and producer surplus (PS) at equilibrium? c. If each case of detergent were sold at $30, determine the amount of the shortage or surplus that would result.

Consider the Market for a Procter and Gamble Biodegradable Detergent