Questions: At a price of 21, the supply is about 1680 watches. (Round to the nearest whole number as needed.) g. Graph p=S(q)=1.25 q on the same axis used to graph p=28-2.25 q in part d. Choose the correct graph below. A. B. c. D. h. Given that the demand function is p=D(q)=28-2.25 q and that the supply function is p=S(q)=1.25 q, find the equilibrium quantity and the equilibrium price. The equilibrium quantity is watches.

At a price of 21, the supply is about 1680 watches.
(Round to the nearest whole number as needed.)
g. Graph p=S(q)=1.25 q on the same axis used to graph p=28-2.25 q in part d. Choose the correct graph below.
A.
B.
c.
D.
h. Given that the demand function is p=D(q)=28-2.25 q and that the supply function is p=S(q)=1.25 q, find the equilibrium quantity and the equilibrium price.

The equilibrium quantity is watches.

Transcript text: At a price of \$21, the supply is about 1680 watches. (Round to the nearest whole number as needed.) g. Graph $p=S(q)=1.25 q$ on the same axis used to graph $p=28-2.25 q$ in part d. Choose the correct graph below. A. B. c. D. h. Given that the demand function is $\mathrm{p}=\mathrm{D}(\mathrm{q})=28-2.25 \mathrm{q}$ and that the supply function is $\mathrm{p}=\mathrm{S}(\mathrm{q})=1.25 \mathrm{q}$, find the equilibrium quantity and the equilibrium price. The equilibrium quantity is $\square$ watches.

Solution

Solution Steps

Step 1: Find the intersection point of the two lines

The two lines represent the supply and demand functions: Supply: $p = 1.25q$ Demand: $p = 28 - 2.25q$

The intersection point represents the equilibrium point where supply equals demand. We can find this by setting the two equations equal to each other:

$1.25q = 28 - 2.25q$

Step 2: Solve for q (equilibrium quantity)

Add $2.25q$ to both sides of the equation: $1.25q + 2.25q = 28$ $3.5q = 28$

Divide both sides by 3.5: $q = \frac{28}{3.5}$ $q = 8$

Step 3: Solve for p (equilibrium price)

Substitute the value of $q$ (8) back into either the supply or demand equation. Using the supply equation: $p = 1.25 * 8$ $p = 10$

Step 4: Identify the correct graph

Graph A correctly shows the intersection of the two lines at q = 8. The demand line (red) starts at p=28 and decreases, while the supply line (blue) starts at the origin and increases. Their intersection point in graph A corresponds to q=8 and p=10.