Suppose the demand curve for a product is Qd 80... - SS2 Economics Determination of Equilibrium Price And Quantity Question
Suppose the demand curve for a product is Qd = 80 - P and the supply curve is Qs = 30 + 2P. What is the equilibrium price and quantity?
Setting Qd = Qs, we have:
80 - P = 30 + 2P
Simplifying the equation, we get:
50 = 3P
P = 16.67
Substituting P = 16.67 into either the demand or supply equation, we get:
Qd = 80 - 16.67 = 63.33
Qs = 30 + 2(16.67) = 63.33
The equilibrium price is $16.67 and the equilibrium quantity is 63.33 units (rounded to two decimal places).
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