Answer to Question #149170 in Macroeconomics for Malav shah

Question

2. Suppose the demand equation for computers by Teetan Ltd for the year 2017 is given by Qd= 1200-P and the supply equation is given by Qs= 120+3P. Find equilibrium price and analyse what would be the excess demand or supply if price changes to Rs 400 and Rs 120.

Answer 1

$$Q_d=Q_s$$

$$1200-p=120+3p$$

$$4p=1080$$

$$p=270$$

$$Q=930$$

If p=400  would be the excess supply

If p=120  would be the excess demand