Study Abstract

One afternoon, there was a big fire at one of the production factories of Sam's Barbeque Ribs Company. The recipe originator and owner, Sam, put too much special barbeque sauce on a large batch of ribs and the factory went up in flames. Everything was lost -- the building, all the equipment -- everything, including the entire company's bookkeeping records which were kept in that particular building.

Fortunately, nobody was hurt. Sam had insurance that covered the building and equipment, but didn't have any copies of those darn bookkeeping records that were needed for knowing how many pounds of ribs to produce each day.

So, Sam called a meeting of all his accountants and business managers in the hopes that some of them might recall some of what was on those bookkeeping records. Sam didn't remember anything about the records. One accountant remembered that the producer's surplus was 108,900, while another recalled that the consumer's surplus was a fifth of the producer's surplus. A business manager recalled that the supply curve was given by

for a quantity q, and that the demand curve was linear, but she didn't recall the exact equation.

From the information they recalled, is it possible for them to figure out where the supply equals the demand (the equilibrium point) and to determine an equation for the demand curve?

Concept Brief Review