If demand curve for alphonso mangoes is D=25000−70P and supply curve is S=10000+80P, find the equilibrium quantity?
- A18,000 units
- B2,000 units
- C1,800 units
- D200 units
Solution & Step-by-step Explanation
At market equilibrium, the quantity demanded (D) equals the quantity supplied (S):
D=S
Substitute the given equations:
25000−70P=10000+80P
Rearrange terms to solve for price (P):
25000−10000=80P+70P
15000=150P
P=
150
15000
=100
Now, substitute P=100 back into either the demand or supply equation to find the equilibrium quantity:
D=25000−70(100)
D=25000−7000=18000units
D=S
Substitute the given equations:
25000−70P=10000+80P
Rearrange terms to solve for price (P):
25000−10000=80P+70P
15000=150P
P=
150
15000
=100
Now, substitute P=100 back into either the demand or supply equation to find the equilibrium quantity:
D=25000−70(100)
D=25000−7000=18000units