Assume the Demand Function for Scooters Is Given by QD

Multiple Choice

Assume the demand function for scooters is given by QD = 20,000 - 10P + 0.2I, where P = price of a scooter, and I = average income of consumers. Also, assume the supply function of scooters is given by QS = 20 P. If the market for scooters is perfectly competitive, and the average income of consumers is $20,000, what are the equilibrium price and quantity in this market?

A) The equilibrium price is $16,000, and 800 scooters are traded.
B) The equilibrium price is $1,600, and 32,000 scooters are traded.
C) The equilibrium price is $800, and 16,000 scooters are traded.
D) The equilibrium price is $800, and 32,000 scooters are traded.