Question

Equilibrium in the market-place means that quantity supplied 'Qs' equals quantity demanded 'Qd'.

1. Given the following equations:
Qs = 1,050 and Qd = 2000 – 2.5P
Solve for the equilibrium price 'P'.

Answer 1

P = 380

Step-by-step explanation:

At equilibrium, we have:

Qs = Qd

Since Qs = 1,050 and Qd = 2,000 – 2.5P, we therefore have:

1,050 = 2,000 – 2.5P

We now proceed to rearrange and solve for P as follows:

1,050 - 2000 + 2.5P = 0

2.5P = 2,000 - 1,050

2.5P = 950

P = 950 / 2.5 = 950 ÷ 2.5

P = 380

Therefore, the equilibrium price 'P' is equal to 380.