Answer:
(a) $45
(b) 15 units
Explanation:
Given that,
Demand equation: P = 75 - 2Qd
Supply equation: P = 4Qs - 15
Qd and Qs are quantity demanded and quantity supplied,
(a) At equilibrium,
Qs = Qd = Q*
P = 75 - 2Q*
Q* = (75 - P) ÷ 2
P = 4Q* - 15
P = 4[(75 - P) ÷ 2] - 15
P = 150 - 2P - 15
3P = 135
P* = 45
Therefore, equilibrium price P* = 45
(b) Equilibrium quantity,
Q* = (75 - P) ÷ 2
= (75 - 45) ÷ 2
= 15
