The table shown depicts the demand and supply schedules of a good. Equilibrium in this market will occur at:
A) a price of $1.50 and a quantity of 62.
B) a price of $1.50 and a quantity of 31.
C) a price of $0.00 and a quantity of 75.
D) an indeterminate price and quantity.

Question

The table shown depicts the demand and supply schedules of a good. Equilibrium in this market will occur at:
A) a price of $1.50 and a quantity of 62. 
B) a price of $1.50 and a quantity of 31. 
C) a price of $0.00 and a quantity of 75. 
D) an indeterminate price and quantity.

Quizplus · Accepted Answer

Equilibrium occurs where the quantity demanded equals the quantity supplied. At a price of $1.50, the quantity demanded is 31 and the quantity supplied is also 31, so this is the equilibrium point. At any other price, there will be either a surplus or a shortage of the good, and the market will move towards the equilibrium point through adjustments in price and/or quantity. Therefore, the correct answer is B.

The Table Shown Depicts the Demand and Supply Schedules of a Good