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Question
The world demand for power transmission wire is made up of both domestic and foreign demands. Thus, the total demand is the sum of the two sub-demands, which are given as:Domestic demand: Pd = 5 - 0.005Qd
Foreign demand: Pf = 3 - 0.00075Qf,
where Pd and Pf are in dollars per pound, and Qd and Qf are in pounds per day.
a. Determine the world demand for power transmission wire.
b. Determine the prices at which domestic and foreign buyers would enter the market.
c. Determine the domestic and foreign quantities at P = $2.50 per pound. Check to see if the sum of Qd and Qf equals Q.
d. Determine total rate of purchases at P = $4.00 per pound.
Answer
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