The demand and supply functions for a commodity are given as Q_d = 50 - 4P and Q_s = 10 + … — JAMB UTME

The demand and supply functions for a commodity are given as $Q_d = 50 - 4P$ and $Q_s = 10 + 6P$ , where $P$ represents the price in Naira, $Q_d$ is the quantity demanded, and $Q_s$ is the quantity supplied. What is the equilibrium price of the commodity?

₦4.00Answer
B
₦6.00
C
₦10.00
D
34 units

Answer

The equilibrium price is ₦4.00.

Market equilibrium occurs where quantity demanded equals quantity supplied (

Q_d = Q_s

). Setting

50 - 4P = 10 + 6P

yields

10P = 40

, which simplifies directly to

P = ₦4.00

Step-by-Step Solution

Set the demand equation equal to the supply equation.

50 - 4P = 10 + 6P

Market equilibrium occurs at the price level where quantity demanded equals quantity supplied (

Q_d = Q_s

Collect like terms on opposite sides of the equation.

50 - 10 = 6P + 4P \implies 40 = 10P

Grouping constants and coefficients allows isolating the price variable

P

Solve for

P

P = \frac{40}{10} = 4

Dividing both sides by 10 yields the equilibrium price of ₦4.00.

Key Concept

Market Equilibrium Determination

Estimated Time:45s

Question

Answer

Step-by-Step Solution

Key Concept

Common Mistakes

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