Finding the Equilibrium

a = 500

c = -25

b = 16

d = 14

Qd = a – bp Qs = c + dp
f(0) = 500 f(0) = -25
f(2) = 500 – 16(2) f(2) = -25 + 14(2)
= 500 – 32 = -25 + 28
= 468 =3
f(4) = 500 – 16(4) f(4) = -25 + 14(4)
= 500 – 64 = -25 + 56
= 436 = 31
f(6) = 500 – 16(6) f(6) = -25 + 14(6)
= 500 – 96 = -25 + 84
= 404 = 59
f(8) = 500 – 16(8) f(8) = -25 + 14(8)
= 500 – 128 = -25 + 112
= 372 = 87
f(10) = 500 – 16(10) f(10) = -25 + 14(10)
= 500 – 160 = -25 + 140
= 340 = 115
f(12) = 500 – 16(12) f(12) = -25 + 14(12)
= 500 – 192 = -25 + 168
= 308 = 143
f(14) = 500 – 16(14) f(14) = -25 + 14(14)
= 500 – 224 = -25 + 196
= 276 = 171
f(16) = 500 – 16(16) f(16) = -25 + 14(16)
= 500 – 256 = - 25 + 224
= 244 = 199
f(18) = 500 – 16(18) f(18) = -25 + 14(18)
= 500 – 288 = -25 + 252
= 212 = 227
f(20) = 500 – 16(20) f(20) = -25 + 14(20)
= 500 – 320 = -25 + 280
= 180 = 255
 Price (P) Quantity Demanded (Qd) • Quantity Supplied (Qs) •
0 500 -25
2 468 3
4 436 31
6 404 59
8 372 87
10 340 115
12 308 143
14 276 171
16 244 199
18 212 227
20 180 255

20
18
16
14
12
10
8
6
4
2

0 50 100 150 200 250 300 350 400 450 500

𝑎−𝑐
𝑃=
𝑏+𝑑
500 − (−25)
=
16 + 14
525
=
30
= 17.5

𝑄𝑑 = 𝑎 − 𝑏𝑃
= 500 − 16(17.5)
= 500 − 280
= 220
𝑄𝑠 = 𝑐 + 𝑑𝑝
= −25 + 14(17.5)
= −25 + 245
= 220