$$\begin{array} { | c | c | c | }
\hline \begin{array} { c }
\text { Price Per } \
\text { Unit }
\end{array} & \text{Quantity Demanded Per Year}&\text{Quantity Supplied Per Year} \
\hline \$ 5 & 2,000 & 0 \
\hline 10 & 1,800 & 300 \
\hline 15 & 1,600 & 600 \
\hline 20 & 1,400 & 900 \
\hline 25 & 1,200 & 1,200 \
\hline 30 & 1,000 & 1,500 \
\hline
\end{array}$$ Refer to the above table. In this competitive market, the price and quantity will settle at
A) $10 and 2,000 units.
B) $15 and 1,600 units.
C) $20 and 900 units.
D) $25 and 1,200 units.

Question

$$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Price Per } \
\text { Unit }
\end{array} & \text{Quantity Demanded Per Year}&\text{Quantity Supplied Per Year} \
\hline \$ 5 & 2,000 & 0 \
\hline 10 & 1,800 & 300 \
\hline 15 & 1,600 & 600 \
\hline 20 & 1,400 & 900 \
\hline 25 & 1,200 & 1,200 \
\hline 30 & 1,000 & 1,500 \
\hline
\end{array}$$ Refer to the above table. In this competitive market, the price and quantity will settle at
A) $10 and 2,000 units.
B) $15 and 1,600 units.
C) $20 and 900 units.
D) $25 and 1,200 units.

Quizplus · Accepted Answer

At a price of $25 per unit, the quantity demanded and quantity supplied are both 1,200 units. This is where the market reaches equilibrium, meaning there is no excess demand or supply. At any price lower than $25, the quantity demanded is greater than the quantity supplied, creating a shortage in the market. At any price higher than $25, the quantity supplied is greater than the quantity demanded, creating a surplus in the market. Therefore, the market will settle at a price of $25 and a quantity of 1,200 units.

Refer to the Above Table