Question

In a Mango market in Lucknow, the demand and supply functions have been estimated as: Demand Q = 200 – 2 P Supply Q = 20 + 4 P Find, a) What are the equilibrium price and quantity of mangoes sold?

Answer 1

The equilibrium price of mangoes in the Lucknow market is $30 and the quantity sold is 140.

Step-by-step explanation:

The equilibrium price and quantity of mangoes sold can be found by setting the demand function (Qd) equal to the supply function (Qs) and solving for the price (P).

Using the given functions:

Demand: Qd = 200 - 2P

Supply: Qs = 20 + 4P

Set Qd = Qs:

200 - 2P = 20 + 4P

Combine like terms:

6P = 180

Divide both sides by 6:

P = 30

Substitute P = 30 into either the demand or supply function to find the quantity:

Using the demand function:

Qd = 200 - 2(30)

Qd = 200 - 60

Qd = 140

Therefore, the equilibrium price of mangoes is $30 and the quantity sold is 140.