CA Foundation · Quantitative Aptitude · Equations
The demand function for a product of Kisan Foods is p = 120 − 2q and the supply function is p = 30 + 3q, where p is price in rupees and q is quantity in units. What is the equilibrium price?
Equilibrium price is ₹84. Setting demand equal to supply gives 120 − 2q = 30 + 3q, so q = 18 units. Substituting into either function gives a price of ₹84.
- A₹66
- B₹84Correct
- C₹48
- D₹90
Explanation
At equilibrium 120 − 2q = 30 + 3q, so 5q = 90 and q = 18. Price = 120 − 36 = 84; check with supply: 30 + 54 = 84. ₹66 comes from wrongly using q = 12, and ₹90 results from using q = 20 incorrectly.
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