Supply and Demand In many applications of economics, as the price of an item goes up, demand for the item goes down and supply of the item goes up. The price where supply and demand are equal is the equilibrium price, and the resulting supply or demand is the equilibrium supply or equilibrium demand. Suppose the supply of a product is related to its price by the equation

where p is in dollars and q is supply in appropriate units. (Here, q stands for quantity.) Furthermore, suppose demand and price for the same product are related by

where p is price and q is demand. The system formed by these two equations has solution (18, 12), as seen in the graph. Use this information to work Exercises 113–118 in order.

Graph p = 3/4 q on the same axes used for Exercise 115.

Exercise 115.

Transcribed Image Text:

q, 3 3 39+18,,