Question

cONSIDER A DEMAND CURVE OF THE FORM Qd= 20-2P WHERE Q IS THE QUANTITY DEMANDED AND AND P IS THE PRICE OF THE GOOD.ALSO CONSIDER A SUPPLY CURVE OF THE FORM QS=2P - 4.graph the curves.at what values of p an q do these curves intersect?

Answer 1

Answer on Question # 77573, Economics -Microeconomics:

Question: Consider a demand curve of the form $Q_{D} = 20 - 2P$ where $Q$ is the quantity demanded and $P$ is the price of the good. Also consider a supply curve of the form $Q_{s} = 2P - 4$ . Graph the curves. At what values of $P$ and $Q$ do these curves intersect?

Solution:

Here, demand curve equation, $Q_{D} = 20 - 2P$ (1)

$[Q_{D} = \text{quantity demanded and } P = \text{ price of the good}]$

Supply curve equation, $Q_{s} = 2P - 4$ (2)

$[Q_{s} = \text{supplied quantity and } P = \text{ price of the good}]$

The two curves intersect when, $Q_{D} = Q_{s}$

Or, $20 - 2P = 2P - 4$

Or, $4P = 24$

Or, $P = 6$

Now put the value of $P$ in equation (2) and we get,

$Q = Q_{s} = Q_{D} = 12 - 8 = 4$

So, at $P = 6$ and $Q = 4$ , the two curves are intersect.

Answer: $P = 6$ and $Q = 4$.

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