Economics: Principles, Problems, and Policies, 19th Edition

Published by McGraw-Hill Education
ISBN 10: 0073511447
ISBN 13: 978-0-07351-144-3

Chapter 3 - Demand, Supply, and Market Equilibrium - Problems - Page 67: 6

Answer

EP = 6. EQ = 20

Work Step by Step

I solved for quantity first. Since P=10-.2Qd and P=2+.2Qs, 10-.2Qd=2+.2Qs. Since Qd=Qs, 10-.2Qd=2+.2Qd. Solving for Qd goes as follows: 8-.2Qd=.2Qd 8=.4Qd Qd=8/.4=20 You can then plug this number into both equations and they will both turn out to have P=6. Therefore, the equilibrium price will be 6 and the quantity will be 6.
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