Problem
Consider the following sequence of changes in the demand and supply for cab service in some city. The price P is a price per mile, while quantity is the total length of cab rides over a month (in thousands of miles). January: Initial demand and supply are given by the equations Qs = 30P - 30 (when P ≥ 1), and Qd = 120 - 20P February: Due to higher prices of gasoline, the supply of cab service changed to Qs = 30P - 60 (when P ≥ 2). March: Over the spring break, the demand for taxi service was higher and therefore the demand curve was given by the equation Qd = 140 - 20P.
a) For each month find the equilibrium price and quantity.
b) Illustrate your answer with a graph. Illustrate the equilibrium prices and quantities on the graph.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.