Supply and Demand of Roof Shingles

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Lesson Parent: 
Supply and Demand Functions
Problem: 

Determine the equilibrium price and quantity of a bundle of roof shingles if their demand function is pd(n)=67−0.6n and their supply function is ps(n)=0.6n. The price p is in dollars per bundle and the quantity n is in thousands of bundles.

Answer: 

SAMPLE SOLUTION

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Solution: 

The equilibrium quantity n′ is found by setting <Sign in to see all the formulas>. First, let's do the algebra to find n′.

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Now that we have n′ we can put it into either <Sign in to see all the formulas> or <Sign in to see all the formulas> to find p′. Let's do both to show that they are equal. For <Sign in to see all the formulas> we have

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For <Sign in to see all the formulas> we have

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Therefore, the equilibrium price is $\$33.50<Sign in to see all the formulas>55,830$ bundles.