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Activity 2, Demand Function CT, Maligaya

The document provides an example of using supply and demand functions to determine equilibrium price and quantity. It gives the supply function Qs = -400 + 5P and demand function Qd = 1800 - 5P. By setting the functions equal and solving for P, the equilibrium price is found to be $220 and the equilibrium quantity is 700 units. It then provides a demand function of Qd = 9,000 - 100P and uses this to derive the market demand schedule for various prices from $10 to $70. A demand curve is drawn based on these points.

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Kerby Geroza Atienza
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96 views3 pages

Activity 2, Demand Function CT, Maligaya

The document provides an example of using supply and demand functions to determine equilibrium price and quantity. It gives the supply function Qs = -400 + 5P and demand function Qd = 1800 - 5P. By setting the functions equal and solving for P, the equilibrium price is found to be $220 and the equilibrium quantity is 700 units. It then provides a demand function of Qd = 9,000 - 100P and uses this to derive the market demand schedule for various prices from $10 to $70. A demand curve is drawn based on these points.

Uploaded by

Kerby Geroza Atienza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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CASTOR TROI F.

MALIGAYA
BSBA HR1-G2

BASIC MICROECONOMICS

P = 220UNIT 3: ELEMENTS OF DEMAND AND SUPPLY

ACTIVITY 2: DEMAND FUNCTION


1. From the following supply and demand functions, determine the equilibrium
price and quantity.
Qd = 1800 – 5P
Qs = -400 + 5P
Where P – price 
Qd – quantity demanded

Qd = 1800 – 5P Qs = -400 + 5P
Qd = Qs
1800 - 5P = -400 + 5P
1800 + 400 = 5P +5P
2200 = 10P
2200 / 10 = P

Qd = 1800 – 5P
      = 1800 – 5(220)
      = 1800 – 1100
      = 700

Qs = -400 + 5P
      = -400 + 5(220)
      = -400 + 1100
      = 700
2. Suppose that the demand function for a commodity is given by Qd = 9,000 –
100 P
a. Derive the market demand schedule for this commodity using the various
prices below.
Indicate your answer on the corresponding space provided. Please show your
computations.
Price                                       Qd
  10                                       8,000
  20                                       7,000
  30                                       6,000
  40                                       5,000
  50                                       4,000
  60                                       3,000
  70                                       2,000
Qd = 9,000 – 100P
      = 9,000 – 100(10)
      = 9,000 – 1,000
      = 8,000
Qd = 9,000 – 100P
      = 9,000 – 100(20)
      = 9,000 – 2,000
      = 7,000

Qd = 9,000 – 100P
      = 9,000 – 100(30)
      = 9,000 – 3,000
      = 6,000
Qd = 9,000 – 100P
      = 9,000 – 100(40)
      = 9,000 – 4,000
      = 5,000
Qd = 9,000 – 100P
      = 9,000 – 100(50)
      = 9,000 – 5,000
      = 4,000
Qd = 9,000 – 100P
      = 9,000 – 100(60)
      = 9,000 – 6,000
      = 3,000
Qd = 9,000 – 100P
      = 9,000 – 100(70)
      = 9,000 – 7,000
      = 2,000

b. Draw the demand curve for this commodity.

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