Q. 7

# Suppose the deman

At the perfect competition, demand and supply are equal.

Qd = Qs

2200 - 3p = 1800 +2p

2200-1800= 2p +3p

400=5p

P = 400/5

P = 80

Qd= 2200-3p

Qd = 2200 - 3* 80

Qd = 2200 - 240

Qd = 1960

The equilibrium price and equilibrium quantity of the commodity X is Rs 80 and 1960 units.

OR

● The x-axis represents quantity and the y-axis represents price.

● The market is in equilibrium at point E.

● A decrease in the supply will shift the supply curve towards the left.

● The original supply curve is SS. It will shift left towards S'S'.

● This will create excess demand which will lead to an increase in competition among the buyers.

● The new supply curve intersects the original demand curve at a higher equilibrium point of E'.

● The equilibrium price will increase from OPe to OPe'.

● The equilibrium quantity will fall from OQe to OQe'.

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