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    Equilibrium point

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    At a price of $1.90 per bushel, the annual U.S. supply and demand for barley are 410 million bushels and 455 million bushels, respectively. When the price rises to $2.70 per bushel, the supply increases to 430 million bushels and the demand decreases to 415 million bushels.

    A. Assuming that the price-supply and the price-demand equations are linear, find equations for each.

    B. Find the equilibrium point for the U.S. barley market.

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    Solution Preview

    Let the x axis is the price and y axis is either supply or demand (in million).

    When price is 1.9, supply is 410 million. When price is 2.7, supply is 430 million.
    => A straight ...

    Solution Summary

    The solution shows how to find the equilibrium point using price-supply and price-demand equations.