Market demand is given as Qd = 40 - 2P. Market supply is given as Qs = 2P. What would result if the market price were $7?

Name: Market demand is given as Qd = 40 - 2P. Market supply is given as Qs = 2P. What would result if the market price were $7?
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Question

Quizplus · Accepted Answer

Qd = 40 - 2P, Qs = 2P. 
Market price = $7. 
Substituting P = 7 into Qd and Qs: 
Qd = 40 - 2(7) = 26 
Qs = 2(7) = 14 
Therefore, quantity demanded (Qd) is less than quantity supplied (Qs), resulting in a shortage of 14 units.

Market Demand Is Given as Qd = 40 - 2P