Question

Suppose that the quantity supplied S and quantity demanded D of baseball caps at a major league game are given by the functions S(p)= 4830 -80p and D(p) = 130p, where p is the price. Find the equilibrium price for caps at the game

Answer 1

Given:

Suppose that the quantity supplied S and quantity demanded D of baseball caps at a major league game is given by the functions S(p)= 4830 -80p and D(p) = 130p, where p is the price

To find:

Find the equilibrium price for caps at the game

Solution:

We have,

"S" → quantity supplied

"D" → quantity demanded

"p" → price

Equation for supply:⇒ S(p) = 4830 - 80p

and

Equation for demand:⇒ D(p) = 130p

We know that → the equilibrium is a point where the demand and supply are equal

So, the two sets of functions of demand and supply will also be equal to each other

∴ S(p) = D(p)

⇒ 4830 - 80p = 130p

⇒ 4830 = 130p + 80p

⇒ 4830 = 210p

⇒ p = $\frac{4830}{210}$

⇒ p = 23

Thus, the equilibrium price for the caps at the game is → 23.

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