The table shows the scale of supply and demand for goods
| P (thousand rubles / per unit) | Qp (thousand units per year) | Qs (thousand units per year) |
|1 |25 |5 |
|2 |20 |10 |
|3 |15 |15 |
|4 |10 |20 |
|5 |5 |25 |
1) Determine the equilibrium sales volume and price?
2) Determine the volume of demand for goods and the volume of supply of goods at a price of P \u003d 2 thousand rubles. per unit?
3) What situation arises in the commodity market at a price of P = 2 thousand rubles. per unit (shortage or overstocking)?
4) Determine the amount of deficit or surplus in the market at a price of P = 2 thousand rubles. per unit?
5) What will sellers do if they find that there is a shortage (surplus) in the market?

Answers:

Solution: 1) analytically, based on the initial data, we determine the supply and demand functions. Qp=a-bP - demand function (based on the initial data - a linear function). Then: 25=а-b; 20=a-2b; Let's solve the system of equations: a=25+b; 20=25+b-2b; b=5; a=30, then the demand function looks like: Qp=30-5P. Qs=a+bP is the supply function (based on the initial data, it is a linear function). 5=a+b; 10=a+2b; a=5-b; 10=5-b+2b; b=5; a=0, then the offer function looks like: Qs=5P. Let's determine the equilibrium price: 30-5P=5P; Then P=3 is the equilibrium price. Let's define the equilibrium sales volume: Qeq.=5*3=15 pcs. is the equilibrium sales volume. 2) Let us determine the volume of demand for goods and the volume of supply of goods at a price of P = 2 thousand rubles. per unit Qp=30-5P=30-5*2=20 thousand units per year - the volume of demand for goods; Qs=5*2=10 thousand units per year - the volume of supply for the product. 3) What situation arises in the commodity market at a price of P = 2 thousand rubles. per unit (shortage or overstocking)? Since at P \u003d 2 thousand rubles. per unit the volume of demand for the goods is 20 thousand units. per year, and the volume of supply is 10 thousand units. per year, there will be a shortage in the market. 4) The volume of deficit in the market at a price of P=2 thousand rubles. per unit will be 10 thousand units. in year. 5) What will sellers do if they find that there is a shortage (surplus) in the market? If there is a shortage of goods on the market, then the sellers will raise the price of the goods accordingly, if there is an excess, then the price will decrease.

Price 100 below the equilibrium price (Pe = 200) - shortage of goods. Subtract from the volume of demand at this price 800 the volume of supply 400. The shortage is not enough refrigerators for buyers). Producers will raise the price so that there is no shortage.

The price of 400 is higher than the equilibrium price - an excess of goods. Let us subtract 500 from the supply volume of 1300. The excess of goods is 800 (manufacturers are ready to sell 800 more refrigerators than buyers want and can buy). Producers will reduce the price to the equilibrium price in order to sell all the products.

3. Let's build a graph of market equilibrium for refrigerators per day using points from the scale. For the demand curve, take the points: P1 = 100, Q 1 = 800; P2 \u003d 400, Q 2 \u003d 500.

For the supply curve: P1 = 100, Q 1 = 400; P2 \u003d 400, Q 2 \u003d 1300.

Fig 2.4. market equilibrium chart

Answer. The equilibrium price is Pe = 200, the equilibrium sales volume is Qe = 700. At a price of 100, the deficit is 400 refrigerators; at a price of 400, the excess is 800 refrigerators.

Task 2.Build a market equilibrium graph, determine the equilibrium price and sales volume. Determine and calculate the deficit and surplus of goods at prices: 5, 15, 20.

Demand function: QD = 50 - 2 P .

Suggestion function: QS = 5 + P .

Decision:

Table 2.5

Supply and demand scale

P, price	QD	QS

Rice. 2.5. market equilibrium chart

Answer. Equilibrium price 15, equilibrium sales 20. At a price of 5 rubles: the deficit is 30. At a price of 15 rubles: market equilibrium. At a price of 20 rubles: an excess of goods 15.

2.2. Elasticity of supply and demand

Having studied the concepts of supply and demand, market equilibrium and equilibrium price, we will get acquainted with elasticity. It is not enough for an entrepreneur to be able to determine the equilibrium price to achieve market equilibrium. The market situation is unstable, business activity is influenced by environmental factors: suppliers, buyers, competitors, tax and monetary policy of the state, etc. Many factors lead to price changes - decrease or increase.

Therefore, an entrepreneur needs to know how supply and demand will change when prices for his products change. Even before opening a company, an entrepreneur determines with what elasticity he will work with the product, in order to know what price manipulations he can carry out to increase sales volumes, and which ones will lead to a drop in supply and demand.

2.2.1. Elasticity of demand

Basic concepts

The elasticity of demand is shows how much the volume of demand for a product will change in response to changes in such factors as price, consumer income, price of another product.

The price elasticity of demand is shows how much the quantity demanded will change when the price of a product changes.

A product can be of elastic demand, inelastic demand, or demand of unit elasticity. To determine the type of elasticity, we use two indicators:

1. Coefficient of elasticity.

2. The total revenue of the seller.

1. Price elasticity of demand (ED)- shows the relative change in the quantity demanded with a relative change in price.

To calculate, we use the formula:

ED=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

where P1 is the initial price of the product,

P2 - new price,

Q 1 - initial demand

Q2 is the new volume of demand.

Price elasticity of demand shows the percentage change in quantity demanded when the price changes by 1%.

There are three types of elasticity of demand:

Easily replaceable goods (meat, fruit).

Goods with price inelastic demand:

basic necessities (medicines, footwear, electricity);

Goods, the cost of which is insignificant for the family budget (pencils, toothbrushes);

hard-to-replace goods (bread, light bulbs, gasoline).

Factors of price elasticity of demand.

1. Availability of substitute products and complements on the market. The more close substitutes a product has, the higher its elasticity of demand and vice versa. If a good is a less significant complement of an important good, then the demand for it is usually inelastic.

2. The time frame within which the purchase decision is made. Demand is less elastic over short periods of time than over long periods.

2. Seller's total revenue TR calculated by the formula:

TR = P x Q , (2.9)

where P is the price of the product,

Q is the quantity of the item at that price.

Examples of problem solving

Task 1. With an increase in the price of milk from 30 to 35 rubles. for 1 liter in the store, the volume of demand for it decreased from 100 to 98 liters. Determine the type of elasticity of demand for milk, the change in the total revenue of the seller.

Decision

1. Calculate .

P1 \u003d 30 rubles, P2 \u003d 35 rubles.

Q 1 \u003d 100 l, Q 2 \u003d 98 l.

ED=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

ED=	98 – 100		30 + 35	= – 0,13%
35 – 30	100 + 98

|ED| = 0.13%< 1% – объём спроса сократился в меньшей степени (на 0,13%), чем выросла цена (на 1%), поэтому молоко – товар неэластичного спроса.

2. Determine how the seller's revenue will change with an increase in the price of milk from 30 to 35 rubles. per litre.

We calculate the revenue at the initial price of 30 rubles.

TR 1 = P 1 x Q 1

TR 1 \u003d 30 x 100 \u003d 3000 rubles.

Calculate the seller's revenue at the new price of 35 rubles.

TR 2 = P 2 x Q 2

TR 2 \u003d 35 x 98 \u003d 3430 rubles.

∆TR = TR 2 – TR 1

∆TR \u003d 3430 - 3000 \u003d 430 rubles.

Answer. Since the milk | ED |< 1%, то спрос неэластичен, то есть он слабо реагирует на изменение цены. При повышении цены на молоко объём спроса сократился незначительно. Поэтому выручка продавца, несмотря на повышение цены, выросла на 430 руб.

Task 2. With an increase in the price of apples from 65 to 90 rubles. for 1 kg in the store, the volume of demand for it decreased from 30 to 18 kg. Determine the type of elasticity of demand for apples, the change in the total revenue of the seller.

Decision

1. Calculate price elasticity of demand.

P1 \u003d 65 rubles, P2 \u003d 90 rubles.

Q 1 = 30 kg, Q 2 = 18 kg.

ED=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

ED=	18 – 30		65 + 90	= – 1,55%
90 – 65	30 + 18

|ED| \u003d 1.55% > 1% - the volume of demand decreased to a greater extent (by 1.55%) than the price increased (by 1%), so apples are a product of elastic demand.

2. Let's determine how the seller's revenue will change with an increase in the price of apples from 65 to 90 rubles. per kg.

Let's calculate the revenue at the initial price of 65 rubles.

TR 1 = P 1 x Q 1

TR 1 \u003d 65 x 30 \u003d 1950 rubles.

Calculate the seller's revenue at the new price of 90 rubles.

TR 2 = P 2 x Q 2

TR 2 \u003d 90 x 18 \u003d 1620 rubles.

Calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR \u003d 1620 - 1950 \u003d -330 rubles.

Answer. Since apples |ED | > 1%, then demand is elastic, that is, it is sensitive to price changes. When the price of milk rises, the quantity demanded falls more than the price rises. Therefore, the seller's revenue decreased by 330 rubles.

Task 3. With an increase in the price of umbrellas from 500 to 1000 rubles. for 1 umbrella in the store
the volume of demand for them decreased from 80 to 40 pieces. Determine the type of elasticity of demand, the change in the total revenue of the seller.

Decision:

1. Calculate price elasticity of demand.

P1 \u003d 500 rubles, P2 \u003d 1000 rubles.

Q 1 = 80 pcs., Q 2 = 40 pcs.

ED=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

ED=	40 – 80		500 + 1000
1000 – 500	80 + 40

|ED| \u003d 1% \u003d 1% - the volume of demand decreased to the same extent as the price increased (by 1%), so the umbrella is a demand good of unit elasticity.

2. Determine how the seller's revenue will change.

TR 1 = P 1 x Q 1

TR 1 \u003d 500 x 80 \u003d 40,000 rubles.

Calculate the seller's revenue at the new price of 1000 rubles.

TR 2 = P 2 x Q 2

TR 2 \u003d 1000 x 40 \u003d 40,000 rubles.

Calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR = 0 rub.

Answer. Since the umbrella | ED | \u003d 1%, then the demand of unit elasticity, that is, the volume of demand, changes to the same extent as the price. Therefore, the seller's revenue did not change after the price change.

2.2.2. Supply elasticity

Basic concepts

The elasticity of supply the ability of supply or its quantity to change as a result of changes in market prices.

Depending on the level of the supply elasticity coefficient, the following types of elasticity are distinguished.

1. If Ed>1, then the sentence elastic, it is sensitive to changes in the price situation, even a slight change in price leads to a significant change in sales volumes; When the price falls, the volume of sales decreases significantly, and when the price increases, the volume of sales increases.

2. If Ed < 1, то предложение inelastic, it reacts weakly to changes in the price situation, even a significant change in price does not lead to significant changes in sales volumes. The producer cannot benefit from a favorable market situation, and in the event of a price decrease, he incurs losses.

3. If Ed= 1, then the sentence unit elasticity, changes in supply and price occur in the same proportion, the income and profit of the producer remain the same.

Coefficient of price elasticity of supply(ES ) shows the relative change in the volume of supply with a relative change in price.

The calculation formula is similar to the ED calculation formula.

ES=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

The elasticity of supply depends on many factors:

1. Possibility of long-term storage and cost of storage. A product that cannot be stored for a long time or is expensive to store has a low elasticity of supply.

2. Specifics of the production process. In the event that the producer of a good can either increase its output when the price rises, or produce another good when the price falls, the supply of this good will be elastic.

3. Time factor. The producer cannot quickly respond to price changes, since it takes a certain amount of time to hire additional workers, purchase means of production (when it is necessary to increase output), or reduce part of the workers, make payments with a bank loan (when it is necessary to reduce output). In the short run, supply can be increased by growth in demand (price) only through more intensive use of existing production capacities. However, this intensity can only increase market supply by a relatively small amount. Therefore, in the short run, supply is inelastic with respect to price. In the long run, entrepreneurs can increase their productive capacity through the expansion of existing facilities and the construction of new enterprises by firms. Thus, in the long run, the price elasticity of supply is quite significant.

4. Prices of other goods, including resources. In this case, we are talking about cross elasticity of supply.

5. Degrees of achieved use of resources: labor, material, natural. If these resources are not available, then the supply response to elasticity is very small.

Examples of problem solving

Task 1. With an increase in the price of yogurt from 15 to 25 rubles. for 1 piece in the store, the volume of supply for them increased from 100 to 110 pcs. Determine the type of elasticity of supply, the change in the total revenue of the seller.

Decision:

1. Calculate price elasticity of supply.

P1 = 15 rubles, P2 = 25 rubles.

Q 1 = 100 pcs., Q 2 = 110 pcs.

ES=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

ES=	110 – 100		15 + 25
25 – 15	100 + 110

ES = 0.19%< 1% – объём предложения увеличился в меньшей степени (на 0,19%) чем выросла цена (на 1%), поэтому йогурт – товар неэластичного предложения.

2. Let's determine how the seller's revenue will change when the price of yogurt increases from 15 to 25 rubles. for 1 piece

We calculate the revenue at the initial price of 15 rubles.

TR 1 = P 1 x Q 1

TR 1 \u003d 15 x 100 \u003d 1500 rubles.

Calculate the seller's revenue at the new price of 25 rubles.

TR 2 = P 2 x Q 2

TR 2 \u003d 25 x 110 \u003d 2750 rubles.

Calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR \u003d 2750 - 1500 \u003d 1250 rubles.

Answer. Since on yogurt ES< 1%, то предложение неэластично, то есть оно слабо реагирует на изменение цены. Выручка продавца выросла на 1250 руб.

Task 2. With a decrease in the price of shirts from 500 to 450 rubles. for 1 piece in the shop
the volume of supply for them was reduced from 70 to 50 units. Determine the type of elasticity of supply, the change in the total revenue of the seller.

Decision:

1. Calculate price elasticity of supply.

P1 = 500 rubles, P2 = 450 rubles.

Q 1 = 70 pcs., Q 2 = 50 pcs.

ES=	Q2-Q1		P1+P2
P2-P1	Q1+Q2

ES=	50 – 70		500 + 450
450 – 500	70 + 50

ES = 3.17% > 1% - the supply decreased more (by 3.17%) than the price decreased (by 1%), so shirts are a product of elastic supply.

2. Let's determine how the seller's revenue will change when the price of shirts decreases from 500 to 450 rubles. for 1 piece

We calculate the revenue at the initial price of 500 rubles.

TR 1 = P 1 x Q 1

TR 1 \u003d 500 x 70 \u003d 35,000 rubles.

Calculate the seller's revenue at the new price of 450 rubles.

TR 2 = P 2 x Q 2

TR 2 \u003d 450 x 50 \u003d 22,500 rubles.

Calculate the change in revenue and draw a conclusion.

∆TR = TR 2 – TR 1

∆TR \u003d 22,500 - 35,000 \u003d - 12,500 rubles.

Answer. Since ED > 1% for a shirt, the supply is elastic, that is, it is sensitive to price changes. The seller's revenue decreased significantly - by 12,500 rubles. It is not profitable for the manufacturer to reduce the prices of goods with elastic demand due to a decrease in revenue.

3. PRODUCTION COSTS

In a market economy, the goal of producers is to maximize profits. Therefore, entrepreneurs choose which product to produce, focusing on consumer demand and the possibility of making a profit. To increase profits, enterprises use new technologies, reduce costs.

Production volumes are affected by costs. If they increase, then the company reduces production volumes. If costs go down, then supply goes up.

Basic concepts

Costs- these are the costs incurred by the company for the organization of production and marketing of products.

Cost classification

1. fixed costs (FC)- costs that do not directly depend on the volume of output and that the company incurs even with a complete stop of production.

2. variable costs (VC)- costs that directly depend on the volume of output and include the cost of purchasing raw materials, energy, production services, etc.

3. General costs (TC)- the sum of fixed and variable costs:

TC=FC+VC(3.1)

4. Average fixed costs (A.F.C.)- fixed costs per unit of production, which can be calculated by the formula:

5. Average variable costs (AVC)- variable costs:

6. Average total cost- total cost per unit of production:

AC=AFC+AVC(3.4)

scale effect

scale effect– change in production costs and economic indicators due to an increase in production volume .

Depending on the nature, there are three scale effects:

1. Positive

2. Negative

3. Permanent.

Positive effect- as production volumes increase, production costs decrease.

negative effect- As production increases, costs increase.

As you know, the market, in the economic sense of the word, works according to certain rules and laws that regulate the price, shortage of goods or its surplus. These concepts are key and affect all other processes. What is a commodity deficit and surplus, as well as the mechanisms for their appearance and elimination are discussed below.

Basic concepts

The ideal situation in the market is the same amount of goods offered for sale and buyers who are ready to purchase it at a set price. Such a correspondence of supply and demand is called the Price, which is established under such conditions, is also called the equilibrium price. However, such a situation can occur only at a single point in time, but is not capable of persisting for a long period. The constant change in supply and demand, due to many variable factors, causes either an increase in demand or an increase in supply. This is how the phenomena called commodity shortages and commodity surpluses arise. The first concept defines the excess of demand over supply, and the second - just the opposite.

Emergence and elimination of deficiencies on a market scale

The main reason why a trade deficit occurs at a certain point in time is a sharp increase in demand, to which supply does not have time to respond. However, with non-interference in the process of the state or insurmountable specific factors (wars, natural disasters, natural disasters, etc.), the market is able to independently regulate this process. It looks like this:

1. Demand increases and there is a shortage of goods.
2. The equilibrium price rises, which pushes the producer to increase output.
3. The number of goods on the market is increasing.
4. There is a marketable
5. The equilibrium price falls, which initiates a reduction in output.
6. The state of supply and demand is stabilizing.

Such processes take place in the market continuously and are part of the country's economic system. However, if there is a deviation from the scheme outlined above, then regulation does not occur, the consequences can be very complex: constant and one group and an excess of another, growing discontent among the population, the emergence of shadow schemes for production, supply and sale, etc.

An example from the recent past

Commodity shortages can also arise for reasons of excessive intervention in market processes, which often takes place in a planned or command economy. A striking example of this is the lack of food and food products in the 1980s in the USSR. Too extensive, busy and completely inflexible system of production and procurement planning, along with the growth of the well-being of the population and the availability of free cash, led to the fact that the store shelves were empty, and huge queues lined up for any product, if available. Manufacturers did not have time to satisfy the needs of the consumer, as they were not able to quickly respond to demand - all processes were strictly subordinated to bureaucratic procedures that lasted too long and could not meet market requirements. Thus, for a sufficiently long period of time, a constant commodity deficit was established on the scale of the market of the whole country. It is difficult for a command economy to cope with this phenomenon due to the factors listed above, so the problem can be solved either by a complete restructuring of the system, or by changing it.

Phenomenon in microeconomics

A commodity deficit can occur not only on the scale of the economy of the whole country, but also at individual enterprises. It can also be both temporary and permanent, characterized by a lack of finished products to cover the demand for it. But unlike macroeconomic processes in the enterprise, the balance of stocks and demand, on the contrary, depends on the quality of planning. True, the speed of production response to market changes is also important. At the microeconomic level, a shortage of goods has a number of consequences: loss of profit, the likelihood of losing both regular and potential customers, and deterioration of reputation.

Causes and consequences of a surplus

The excess of the supply of any product or of an entire group over demand causes a surplus. This phenomenon is also called a surplus. The appearance of surpluses in a market economy is a natural process - a consequence of imbalance - and is independently regulated in the following way:

1. Decrease in demand or excess supply.
2. The emergence of a surplus.
3. Decrease in the market price.
4. Reducing the volume of production and supply.
5. Rising market price.
6. Stabilization of the state of supply and demand.

In a planned economy, commodity surpluses are the result of incorrect forecasting. Since such a system is unable to self-regulate due to excessive intervention, the surplus can last long enough without the possibility of its settlement.

Enterprise-wide surplus

Surplus within a single enterprise also exists. Commodity deficit and surplus in microeconomics are not regulated by the market, but “manually”, i.e. primarily through planning and forecasting. If errors are made in these processes, then products not sold on time form surpluses that can lead to monetary losses. This is especially acute for food enterprises and others, the period of sale of goods of which is short. Also, a surplus can cause significant harm to the financial stability of industries whose products are seasonally dependent.

It is impossible to solve the problem of the balance of supply and demand once and for all either on a national scale or within an individual enterprise. In addition, such a decision is not required, since shortages and surpluses are important processes that, among other things, stimulate the development of the economy and production, as well as interstate trade and relations in the context of exports and imports.

Task 1. Construct a market equilibrium graph for refrigerators in a store per day. Determine the equilibrium price (Pe) and the equilibrium sales volume (Qe). Determine the presence of a shortage and an excess of goods at prices of 100 and 400 rubles.

1. Demand function: Q D \u003d 900 - R.

2. Offer function: Q S \u003d 100 + 3P.

Decision:

1. Using the functions, we determine the equilibrium price and the equilibrium sales volume. To do this, we equate the functions.

900 - Р = 100 + 3Р, 900 - 100 = 3Р + Р, 800 = 4Р, Pe = 200 - equilibrium price.

Substitute the resulting equilibrium price into any of the functions: Q D = 900 - 200 = 700 or Q S = 100 + 3x200 = 700. The equilibrium sales volume is Qе = 700.

2. Let's build a scale.

Table 2.4

Supply and demand scale

Using the scale, we determine the excess and shortage of goods at prices of 100 and 400.

Price 100 below the equilibrium price (Pe = 200) - shortage of goods. Let us subtract 800 from the volume of demand at this price, the volume of supply 400. The deficit is 400 (400 refrigerators are not enough for buyers). Producers will raise the price so that there is no shortage.

The price of 400 is higher than the equilibrium price - an excess of goods. Let us subtract 500 from the supply volume of 1300. The excess of goods is 800 (manufacturers are ready to sell 800 more refrigerators than buyers want and can buy). Producers will reduce the price to the equilibrium price in order to sell all the products.

3. Let's build a graph of market equilibrium for refrigerators per day using points from the scale. For the demand curve, take the points: P 1 \u003d 100, Q 1 \u003d 800; P 2 \u003d 400, Q 2 \u003d 500.

For the supply curve: P 1 = 100, Q 1 = 400; P 2 \u003d 400, Q 2 \u003d 1300.

Fig 2.4. market equilibrium chart

Answer. The equilibrium price is Pe = 200, the equilibrium sales volume is Qe = 700. At a price of 100, the deficit is 400 refrigerators; at a price of 400, the excess is 800 refrigerators.

Task 2. Build a market equilibrium graph, determine the equilibrium price and sales volume. Determine and calculate the deficit and surplus of goods at prices: 5, 15, 20.

Demand function: Q D = 50 - 2P.

Offer function: Q S = 5 + P.

Decision:

Table 2.5

Supply and demand scale

P, price	Q D	Q S

Rice. 2.5. market equilibrium chart

Answer. Equilibrium price 15, equilibrium sales 20. At a price of 5 rubles: the deficit is 30. At a price of 15 rubles: market equilibrium. At a price of 20 rubles: an excess of goods 15.

2.2. Elasticity of supply and demand

Having studied the concepts of supply and demand, market equilibrium and equilibrium price, we will get acquainted with elasticity. It is not enough for an entrepreneur to be able to determine the equilibrium price to achieve market equilibrium. The market situation is unstable, business activity is influenced by environmental factors: suppliers, buyers, competitors, tax and monetary policy of the state, etc. Many factors lead to price changes - decrease or increase.

Therefore, an entrepreneur needs to know how supply and demand will change when prices for his products change. Even before opening a company, an entrepreneur determines with what elasticity he will work with the product, in order to know what price manipulations he can carry out to increase sales volumes, and which ones will lead to a drop in supply and demand.

The equilibrium price is the price at which the quantity demanded in the market equals the quantity supplied. Expressed as Qd(P) = Qs(P) (see basic market parameters).

Service assignment. This online calculator is aimed at solving and checking the following tasks:

1. Equilibrium parameters of the given market (determination of the equilibrium price and equilibrium volume);
2. Coefficients of direct elasticity of supply and demand at the equilibrium point;
3. Consumer and seller surplus, net social gain;
4. The government introduced a commodity subsidy from each sold unit of goods in the amount of N rubles;
5. The amount of the subsidy directed from the state budget;
6. The government introduced a commodity tax on each sold unit of goods in the amount of N rubles;
7. Describe the consequences of the government's decision to fix the price of N above (below) the equilibrium price.

Instruction. Enter the supply and demand equations. The resulting solution is saved in a Word file (see the example of finding the equilibrium price). A graphical solution of the problem is also presented. Qd - demand function, Qs - supply function

Example. Demand function for this product Qd=200–5P , supply function Qs=50+P .

1. Determine the equilibrium price and equilibrium sales volume.
2. Suppose that the city administration decided to set a fixed price at the level of: a) 20 den. units per piece, b) 30 den. units a piece.
3. Analyze the results. How will this affect the behavior of consumers and producers? Present the solution graphically and analytically.

Decision.
Find the equilibrium parameters in the market.
Demand function: Qd = 200 -5P.
Offer function: Qs = 50 + P.
1. Equilibrium parameters of a given market.
At equilibrium Qd = Qs
200 -5P = 50 + P
6p=150
P equals = 25 rubles. - equilibrium price.
Q equals = 75 units. is the equilibrium volume.
W \u003d P Q \u003d 1875 rubles. - income of the seller.

Consumer surplus measures how much better an individual lives on average.
consumer surplus(or gain) is the difference between the maximum price he is willing to pay for the good and the price he actually pays. If we add up the surpluses of all consumers who purchase this product, then we get the size of the total surplus.
Producer Surplus(win) is the difference between the market price and the minimum price for which producers are willing to sell their product.
Seller's surplus (P s P 0 E): (P equals - Ps) Q equals / 2 = (25 - (-50)) 75 / 2 = 2812.5 rubles.
Buyer's surplus (P d P 0 E): (Pd - P equal) Q equal / 2 = (40 - 25) 75 / 2 = 562.5 rubles.
Net social gain: 2812.5 + 562.5 = 3375
The knowledge of surpluses is widely used in practice, for example, when distributing the tax burden or subsidizing industries and firms.

2) Suppose that the city administration decides to set a fixed price of 20 den. units a piece
P fix = 20 rubles.
Volume of demand: Qd = 200 -5 20 = 100.
Supply volume: Qs = 50 + 120 = 70.
After fixing the price, the volume of demand decreased by 25 units. (75 - 100), and the deficit of producers decreased by 5 pieces. (70 - 75). There is a shortage of goods in the market in the amount of 30 pcs. (70 - 100).


Suppose the city administration decides to set a fixed price of 30 denier. units a piece.
P fix = 30 rubles.
Volume of demand: Qd = 200 -5 30 = 50.
Supply volume: Qs = 50 + 1 30 = 80.
After fixing the price, the volume of demand increased by 25 units. (75 - 50), and the producers' surplus increased by 5 units. (80 - 75). There is a surplus of goods in the market in the amount of 30 pieces. (80 - 50).