For the following points (x, y) on the demand curve and supply curve,

QUESTION

For the following points (x, y) on the demand curve and supply curve, x = quantity and y = price. Demand curve points: (10,5) (20,4) (30, 3) (40, 2) (50, 1) Supply curve points: (10, 1) (20, 2) (30, 3) (40, 4) (50, 5) What is the market price?

A) 1
B) 2
C) 3
D) 4
E) 5

ANSWER

Answer: C
Explanation: C) Market price, or equilibrium price, is the point at which the two curves intersect—in this case (30, 3). The equilibrium price is 3.