JAMB Economics 2015 Paper

Concept:Equilibrium price is the price at which quantity demanded equals quantity supplied.At this point, the market is stable with no excess demand or supply.Explanation:The demand function is given as $Q_d = 20 - 2p$.The supply function is given as $Q_s = 6p - 12$.At equilibrium, $Q_d = Q_s$.So, set the two equations equal to each other:$$20 - 2p = 6p - 12$$Collect like terms by adding $12$ to both sides and adding $2p$ to both sides:$$20 + 12 = 6p + 2p$$This simplifies to:$$32 = 8p$$Divide both sides by $8$ to find $p$:$$p = \frac{32}{8}$$$$p = 4$$Therefore, the equilibrium price is $\mathrm{N}4$.Answer:The equilibrium price is $\mathrm{N}4$, which is option A.