Question 26
MediumOriginal questionDemand is Qd = 100 − 10P and supply is Qs = 10P − 20. A rise in incomes changes demand to Qd = 140 − 10P. What is the new equilibrium price?
Show the answer and explanation
CorrectNot quiteAnswer C
Correct answer: C
Explanation
140 − 10P = 10P − 20, so 20P = 160 and P = ₹8.
Quantity = 140 − 80 = 60, up from 40.
- Concept
- New equilibrium after a demand shift
- Typical timeTypical
- 70 s
- Your timeYours
- —
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