The market for pizza in perfect competition is ... - SS2 Economics Price And Quantity Determination Under Perfect Competition Question
The market for pizza in perfect competition is characterized by a demand curve given by Qd = 150 - 3P and a supply curve given by Qs = 30P + 10. What is the equilibrium price and quantity of pizza in this market?
Equilibrium occurs when Qd = Qs. Setting the demand equal to the supply and solving for P:
150 - 3P = 30P + 10
140 = 33P
P = 4.24
Substituting P into either the demand or supply equation gives:
Q = Qd = 150 - 3(4.24) = 137.28
Therefore, the equilibrium price and quantity of pizza in this market are $4.24 and 137.28 units, respectively.
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