The weekly demand for Kelewele among the 2018 batch of MBA students at UPSA is Qdx = 900 – 10Px + 0.2I + 5Py – 4Pz Where Qdx is the quantity demanded of Kelewele Px is the price of Kelewele per lb I...

The weekly demand for
Kelewele
among the 2018 batch of MBA students at UPSA is

Qdx = 900 – 10Px + 0.2I + 5Py – 4Pz

Where Qdx is the quantity demanded of
Kelewele

Px is the price of
Kelewele
per lb

I is the consumer income in Ghana Cedis

Py and Pz are the prices of two goods that are related to
Kelewele

Now suppose the weekly supply function for
Kelewele
at UPSA campus is QSx = -260 + 10Px – 2Pi

Where QSx is the quantity supplied of
Kelewele
and Pi is the price of inputs used in preparing Kelewele

1. What is the supply function if input prices are GHȼ 20 and Gaph the supply curve


2. Compute the equilibrium price and quantity of
   Kelewele.


3. Suppose authorities at UPSA are concerned that
   Kelewele
   sellers at UPSA are exploiting students by charging exorbitant price for their
   Kelewele
   so they decree that no one should sell
   Kelewele
   above GHȼ 40 per lb and What type of price control measure is this?


4. Following the decree, will there be excess demand or excess supply of
   Kelewele
   at UPSA? Calculate the excess demand or excess supply?


5. To ensure that price control measure stands, the authorities have to produce the excess demand or buy the excess supply in d) off the market. How much will this cost the authorities?