Question

The demand curve is P = 100-15Qp. The supply curve is P = 50 + 5Qs.

At the market equilibrium, what is the equilibrium price?
At the market equilibrium, the equilibrium price is

a. 0.40
b. 5
c. 62.50
d. 2.5

Answer 1

The answer is c. 62.50. At the market equilibrium, the demand curve and the supply curve intersect, and the equilibrium price is the price at which the quantity demanded by consumers is equal to the quantity supplied by producers. To calculate the equilibrium price, we can set the two equations equal to each other and solve for the price: 100 - 15Qp = 50 + 5Qs. Solving for the price, we get P = 62.50.