In the diagram above, what is the excess demand at the price of ₦60
Answer Details
In the given diagram, the excess demand at a certain price level is the difference between the quantity demanded and the quantity supplied at that price level.
To determine the excess demand at the price of ₦60, we can find the intersection point of the demand and supply curves at this price level. This point represents the quantity demanded and supplied at this price.
If we look at the graph, we can see that at the price of ₦60, the quantity demanded is 800 while the quantity supplied is 500. Therefore, the excess demand at the price of ₦60 is calculated as:
Excess demand = Quantity demanded - Quantity supplied
Excess demand = 800 - 500
Excess demand = 300
So the answer is 300, which is the difference between the quantity demanded and supplied at the price of ₦60.
