Question

A graph has quantity on the x-axis and price (dollars) on the y-axis. A demand line goes through (20, 60), (40, 45), (60, 30). A supply line goes through (20, 15), (30, 30), (40, 45), (60, 75), (70, 90).
A store’s supply/demand graph for ceiling fans is shown above. If the price is at the equilibrium point, how much money will the store make selling ceiling fans?
a.
$4,500
b.
$1,800
c.
$1,200
d.
$900

Answer 1

The equilibrium is at (40, \$45) since both lines contain that point. Revenue = price × quantity = 40 × 45 = \$1,800. Answer: b.