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Mathematik-Online problems:

Problem 986: Explicit Solution of Recurrence Equation

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Consider a market in which the supply and demand sets are

$\displaystyle S = \{(q,p) \vert \; q=3p-7 \}, \quad D = \{(q,p) \vert \; q=38-12p \}. $

(a)
Write down the recurrence equations which determine the sequence $ p_t$ of prices, assuming that the suppliers operate according to the cobweb model.
(b)
Find the explicit solution given that $ p_o=4$ and describe in words how the sequence $ p_t$ behaves.
(c)
Write down a formula for $ q_t$, the quantity on the market in year $ t$.
(Author: Rafee )

see also:

[Solutions]
  automatisch erstellt am 12. 12. 2007