Consider the market for baby cribs The market for baby cribs

Consider the market for baby cribs. The market for baby cribs is given by Qd = 140 - 0.2p and the market supply of baby cribs is given by Qs = 0.2p - 20, where Qd is the quantity of baby cribs demanded in millions, Qs is the quantity of baby cribs supplied in millions, and P is the price of a baby crib in dollars.

what is the demand for the baby cribs?

what is the supply for baby cribs?

Solution

We have , Qd = 140 - 0.2p ....... (1)
and Qs = 0.2p - 20 .......... (2)
At equilibrium Qd = Qs . So,
140 - 0.2p = 0.2p -20
=>0.4p = 160
=> p = 400$
So, demand for baby cribs = 140 - 0.2*400 = 60 units
Supply for baby cribs = 0.2*400 - 20 = 60 units