JAMB Economics 1987 Question 21

Question 21

Theory of Demand

Use the following information to answer this question. X, Y and Z are the only three consumers of a commodity. Their respective demand schedules for the commodity are as given below:
X: Price (₦) | Quantity (Units)
0 | 20
2 | 15
5 | 10
10 | 0
Y: Price (₦) | Quantity (Units)
0 | 15
2 | 10
5 | 5
10 | 2
Z: Price (₦) | Quantity (Units)
0 | 40
2 | 30
5 | 15
10 | 5
The market demand curve for the commodity cuts the quantity axis when quantity is

  1. A.75 units
  2. B.35 units
  3. C.7 units
  4. D.not determinable from the schedules except when graphed.
Show the answer and explanation

Answer: A (75 units)

Explanation

The demand curve meets the quantity axis where price is zero. Add the three demands at ₦0: 20 + 15 + 40 = 75 units.