Consider the Following Demand and Supply Curves $Q ^ { \mathrm { d } } = 100 - 2 \mathrm { P }$

question 33

Multiple Choice

Consider the following demand and supply curves: $Q ^ { \mathrm { d } } = 100 - 2 \mathrm { P }$ , and $\mathrm { Q } ^ { s } = 1 / 2 \mathrm { P }$ , calculate the equilibrium $P$ and $Q$ for this initial situation and assuming the supply curve changes to $Q ^ { s } = 1 / 2 P$ $+ 10$ . Which of the following is correct?

• A) the initial equilibrium is \(P = 40 , Q = 20\) and the supply curve shifts left.
• B) the initial equilibrium is \(P = 40 , Q = 20\) and the new equilibrium is \(P = 36 , Q = 28\).
• C) the initial equilibrium is \(\mathrm { P } = 40 , \mathrm { Q } = 20\) and the new equilibrium remains the same.
• D) the initial equilibrium is \(P = 40 , Q = 20\) and the new equilibrium is \(P = 38 , Q = 28\).

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Definitions:

Mediation

A form of conflict resolution where a neutral third party aids the disputing sides in reaching a mutually satisfactory agreement.

Neutral Third Party

An unbiased individual or group engaged to mediate or arbitrate disputes between two parties.

Relevant Issues

Matters or topics that are significantly related to or affecting a particular subject or context.

Myth Of The "fixed Pie"

A misconception that in negotiations, the available resources or benefits are limited and cannot be expanded, leading to a win-lose situation.