kammy

Hi,
I just can not solve it, its so basic to… anyways I need to solve the simultaneous equations, the book has the answer of 367.

Pi=550-0.5Pj
Pj=550-0.5Pi.

Any ideas of how to get there? I know you have to multiply to get the same values, then subtract to get Pi=... but I just can not see it! Pretty peed off that im stuck on this. Pi=Pj by the way so no need to sub it back into the equation.
cheers guys

dpb

Are we doing your homew**k now...

kammy

lol, I have an exam in 6 days. If your offering I will give you my dinner money for the rest of the week

Hanslow

Are you told that Pi = Pj in the question or is that something you are meant to prove in your working out?

If you are told, it effectively means Pi = 550 - 0.5Pi

Add 0.5 Pi to both sides gives 3Pi/2 = 550

You can work the rest out.

Hanslow

Or just sub one into t'other, i.e.

Pi = 550 - 0.5*(550 - 0.5Pi)

=> 550 - (0.5 * 550) + 0.25Pi

Get your Pis on one side, then you are sorted.

suprabeast

just to finish it you get:

Pi- 0.25 Pi = -275+550

0.75Pi = 275

therefore Pi = 275 / 3 * 4 = 366.67

kammy

"In equilbrium both firms set the same price" So yes Pi=Pj. The first solution sorts it out. Excellent work, you deserve a scoobynet maths crown
Thanks again.