The demand curve can be graphed using the expression Q = 100 - P and the supply curve can be graphed using the expression Q = 40 + 2P. Find the equilibrium price and quantity in this market.

The equilibrium price and quantity within a market for a good can be found at the intersection of the supply and demand curves. Therefore, we need to use a mathematical method to find the P and Q by equating the two expressions. 100 - P = 40 + 2P 100 - 40 = 2P + P 60 = 3P P = 20 therefore Q = 100 - 20 = 80 therefore the equilibrium price for this good is 20 at 80 units sold.

TK

Related Economics A Level answers

All answers ▸

Discuss measures to reduce an imbalance in the current account?


What can the government do to reduce pollution (negative externality from market failure) within the community?


"What are the causes of an appreciation (outward shift of demand) for a floating exchange rate?"


Explain one disadvantage of increasing the budget deficit