The demand curve for a product is given by q 80 2p and the

The demand curve for a product is given by q = 80 - 2p and the supply curve is given by q = 3p - 60. Enter the exert answers. Find the consumer surplus at the equilibrium. Consumer surplus = Find the producer surplus at the equilibrium. Producer surplus =

Solution

Here is the way to do it:

q = 80-2p
q=3p-60

a) At equilibrium, the q is ?

Equate the demand and supply:

80-2p =3p-60

140=5p
5p=140
p=28

a) Conumer surplus = 80-2p = 80-2(28) = 24

b) Producer surplus:=3p-60 = 3(28)-60 = 24