The following equations represent the demand and supply for silver pendants. Q^D = 50 - 2P
Q^S = -10 + 2P
What is the equilibrium price (P) and quantity (Q - in thousands) of pendants?

Question

The following equations represent the demand and supply for silver pendants. Q^D = 50 - 2P Q^S = -10 + 2P What is the equilibrium price (P) and quantity (Q - in thousands) of pendants?

Quizplus · Accepted Answer

At equilibrium, Q^D = Q^S. Substituting the given equations, we get:50 - 2P = -10 + 2P4P = 60P = $15Substituting P = $15 into either demand or supply equation, we get:Q^D = 50 - 2(15) = 20 thousandQ^S = -10 + 2(15) = 20 thousandTherefore, the equilibrium price is $15 and the equilibrium quantity is 20 thousand pendants.

The Following Equations Represent the Demand and Supply for Silver