Suppose the demand curve for oranges is given by the equatio

Suppose the demand curve for oranges is given by the equation

Q= -200*p=1,000

with quantity measured in oranges per day and price measured in dollars per orange.

The supply curve is Q= 800*p.

Compute the equilibrium price and the quantity of oranges

Solution

The equilibrium price and quantity is computed by equating demand and supply curves,

800P = -200P + 1000

P= 1

At P= $1, Q=800