The demand and supply for the Florida orange juice are as follows:
QS = 8,000,000 + 2,400,000P - 500,000PL - 80,000Pk - 120,000T
QD = 4,500,000 - 1,200,000P + 2,000,000Ps + 1,500Y + 100,000T
Where Ps is the average price of soda, P is the average price of orange juice, T is the average daily high temperature Y is disposal income per household, , PL is the average price of unskilled labor, and Pk is the cost of capital).
Suppose that Y = 12,000, Ps = $5.00, T = 75, Pk = 12.5, and PL = $6
1. Determine the quantity demanded, the quantity supplied, and the shortage or surplus when the P = $10, $15, and $20
2. Determine the market equilibrium price-output combination.