Given that Qd = 40-2P and Qs = 6P+24. Calculate the equilibrium price.
- 34
- 32
-
36
- 16
The correct answer is: C
Explanation
Equilibrium price = quantity demanded = quantity supplied
Equilibrium price = Qd = 40-2P = 6P+24 = Qs
40 - 2p = 6p+ 24
-2p - 6p = -8
24 - 40 = - 16
\(\frac{16}{8}\) = 2
substitute '2' in the equation for 'p'
Qd = 40-2(2) = 6(2)+24
40 - 4 = 36
12 + 24 = 36
Equilibrium price = 36