Suppose the Daily Demand for Coke and Pepsi in a Small

question 33

Multiple Choice

Suppose the daily demand for Coke and Pepsi in a small city are given by Q_C = 90 - 100P_C + 400(P_P - P_C) and Q_P = 90 - 100P_P + 400(P_C - P_P) ,where Q_C and Q_P are the number of cans Coke and Pepsi sell,respectively,in thousands per day.P_C and P_P are the prices of a can of Coke and Pepsi,respectively,measured in dollars.The marginal cost is $0.45 per can for both Coke and Pepsi.If P_C = $0.60,what is Pepsi's demand function?

• A) Q_P = 90 - 500P_P
• B) Q_P = 330 - 400P_P
• C) Q_P = 500 - 330P_P
• D) Q_P = 330 - 500P_P

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Definitions:

Productivity Growth

An increase in the efficiency of production, measured by the amount of goods and services produced per unit of labor or capital.

Trade Deficit

A situation in which a country's imports exceed its exports, resulting in a negative balance of trade.

Negative Merchandise Trade Balance

A situation where a country's imports of goods exceed its exports of goods, leading to a trade deficit in physical goods.

Services Trade Balance

The services trade balance refers to the difference between a country's exports and imports of services.