Question

Price of Video Game Quantity Supplied of Video Games Quantity Demanded of Video Games $50 0 500 $75 50 325 $100 200 200 $150 250 100 $200 400 0 In the supply-and-demand schedule shown above, the equilibrium price is _____. $50 $100 $200

Answer 1

The equilibrium price for video games is $ 100.

To find the equilibrium price of this exercise, one must understand the Law of Supply and Demand and its mechanisms.

According to the Law of Supply and Demand, the supply of a good or service creates the demand for the good or service. In this case, the emergence of the video game market brings up the demand for video game. The mechanism that makes the law work is that demand and supply interact according to price. If the price is high, the demand is low and the quantity offered is high. If the price is low, the quantity offered is low and the quantity demanded is high. This makes all sense, just think that the consumer wants to pay the lowest possible value for a product, while the supplier wants to receive the highest possible value.

In this context, price is the adjustment vector that makes the interaction between demand and supply happen. There will be a time when demand and supply will be the same, that is, the number of video game buyers will be exactly the same as the number of video games being sold. At this point, we say that there is equilibrium in this market, and the price is the equilibrium price.

In this exercise, it happens when the quantity demanded is equal to the quantity supplied, both in 200. At that point, the equilibrium price is $ 100.

Answer 2

Answer is: In the supply-and-demand schedule shown above, the equilibrium price is $100.
For $100 video game quantity supplied and video games quantity demanded are equal 200 = 200.
Equilibrium price is exactly equals the quantity that sellers are willing and able to sell (200 - 200 = 0).