Supply And Demand - Chapter 3 Page 37
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Part I: Preliminaries
We’ve found our equilibrium price: $12.
To confirm that we didn’t make any errors, we can
What about equilibrium quantity? In equilibrium,
also use the supply equation.
we know quantity demanded and quantity supplied are
S
equal, so we can either solve for Q
using the demand
D
Q
5 220,000 1 4,000 (12)
equation, or solve for Q
using the supply equation, and
S
or
we should get the same answer. For example, using the
demand equation, and using the equilibrium price
S
Q
5 28,000
of $12:
We’ve now confirmed that the equilibrium quantity is
D
Q
5 64,000 2 3,000 (12)
28,000.
or
D
Q
5 28,000
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