Question

The supply S(t)S(t) and demand D(t)D(t) functions for a commodity are given in terms of the unit price p(t)p(t) at time tt. Assume that price changes at a rate proportional to the shortage D(t)S(t)D(t)-S(t), with the indicated constant of proportionality kk and initial price p0p_0. In each exercise:

(a) Set up and solve a differential equation for p(t)p(t).

(b) Fund the unit price of the commodity when t=4t=4.

(c) Determine what happens to the price as tt \rightarrow \infty.

S(t)=1+p(t);D(t)=2+8ek/2;k=0.03;p0=2S(t)=1+p(t) ; D(t)=2+8 e^{-k / 2} ; k=0.03 ; p_0=2

Solution

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Answered 1 year ago
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We are required to:

  • (A) Generate the differential equation using the formula D(t)S(t)D(t)-S(t).
  • (B) Determine the unit price at t=4t=4.
  • (C) Determine the unit price at tt approaches to infinity.

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