Question

If demand function is Qd =150 +10p and supply function is Qs=300-20p. Find the equilibrium price?

Answer 1

SOLUTION

GIVEN

The demand function is $\sf{Q_d}$ = 150 + 10p and supply function is $\sf{Q_s}$ = 300 - 20p

TO DETERMINE

The equilibrium price

EVALUATION

Here it is given that the demand function is $\sf{Q_d}$ = 150 + 10p and supply function is $\sf{Q_s}$ = 300 - 20p

Now at equilibrium

$\sf{Q_d = Q_s}$

$\sf{ \implies \: 150 + 10p = 300 - 20p}$

$\sf{ \implies \: 10p + 20p = 300 - 150}$

$\sf{ \implies \: 30p = 150}$

$\sf{ \implies \: p = 5}$

FINAL ANSWER

Hence the required equilibrium price = 5 unit

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