Question

Consider the following market demand and supply schedules for momo. Price (Rs) Quantity demanded Quantity supplied 100 50 10 80 40 20 60 30 30 40 20 40 20 10 50 a. b. What is equilibrium price and quantity? and why? Draw demand and supply curves in the same graph and show equilibrium. ​

Answer 1

Answer:

The Law of Demand states that when the price of a commodity falls, its demand increases and when the price of a commodity rises, its demand decreases; other things remaining constant. Thus, there exists an inverse relationship between price and quantity demanded of a commodity. The functional relationship between price and quantity demanded can be represented as Dx = f(Px). Now let us discuss the Demand Schedule in detail.