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Given that Qd = 10 - 2p whileQs = 5 + 3P, if P = N1, determine the equilibrium q...


Question

Given that Qd = 10 - 2p whileQs = 5 + 3P, if P = N1, determine the equilibrium quantity.

Options

A)
7
B)
6
C)
5
D)
8

The correct answer is D.

Explanation:

To get equilibrium price and quantity:
i) Get function solved for Qs and Qd (quantity supplied) and Qd (quantity demanded)
ii) Set Qs equal to Qd
iii) Solve for P (equilibrium price)
iv) Plug your P back into your Qs and Qd function to get the quantity.
when, Qd = 10 − 2p and Qs = 5 + 3p
if Qd = Qs then,
10 − 2p = 5 + 3p
solving for p: 10 − 5 = 3p + 2p
5 = 5p
p = 1 (given in the equation)
Equilibrium Quantity will be gotten by plugging P into Qd and Qs respectively;
Qd = 10 − 2p Qs = 5 + 2p
= 10 − 2(1) = 5 + 3(1)
= 10 − 2 = 5 + 3
= 8

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Discussion (2)

  • Michelle

    The question says Qs =5 x 3p, not Qs= 5 +3p...😐

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  • To get equilibrium price and quantity:
    i) Get function solved for Qs and Qd (quantity supplied) and Qd (quantity demanded)
    ii) Set Qs equal to Qd
    iii) Solve for P (equilibrium price)
    iv) Plug your P back into your Qs and Qd function to get the quantity.
    when, Qd = 10 − 2p and Qs = 5 + 3p
    if Qd = Qs then,
    10 − 2p = 5 + 3p
    solving for p: 10 − 5 = 3p + 2p
    5 = 5p
    p = 1 (given in the equation)
    Equilibrium Quantity will be gotten by plugging P into Qd and Qs respectively;
    Qd = 10 − 2p Qs = 5 + 2p
    = 10 − 2(1) = 5 + 3(1)
    = 10 − 2 = 5 + 3
    = 8

    Reply
    Like