Scarcity & Tradeoffs
Market Graphs (Supply, Demand, etc.)
Government Intervention in Market
Firm Graphs (Fixed, Variable, Marginal Cost, etc.)

Equilibrium

Equilibrium occurs at the price where quantity demanded equals quantity supplied

Price of White Sneakers ($)Quantity Supplied
$1001
$1502
$2003
Price of White Sneakers ($)Quantity Demanded
$1003
$1502
$2001

Equilibrium (mathematically)

Set the demand and supply equations equal to each other!

Scenario: In the market for white sneakers, demand is -50q + 250 and supply is 50q + 50. Calculate equilibrium quantity and price.

Demand = -50q + 250
Supply = 50q + 50

Solve for q by setting supply equal to demand!

50q + 50 = -50q + 250
50q (+50q) = 250 (-50)
100q = 200
q = 2

Plug q = 2 into either the demand or supply equations (you'll get the same value)!

Demand = -50(2) + 250
Demand = (-100) + 250
Demand = 150

Supply = 50(2) + 50
Supply = (100) + 50
Supply = 150

Answer: In the market for white sneakers, the equilibrium quantity is 2 white sneakers at an equilibrium price of $150.

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