Macroeconomics 20th Edition by Campbell McConnell ,Stanley Brue ,Sean Flynn

Exercise 34

ADVANCED ANALYSIS Assume that demand for a commodity is represented by the equation P = 10 -.2 Q d and supply by the equation P = 2 +.2 Q s, where Qd and Q s are quantity demanded and quantity supplied, respectively, and P is price. Using the equilibrium condition Q s = Q d, solve the equations to determine equilibrium price. Now determine equilibrium quantity.