Industry supply and demand are given by: QD = 1000 - 2P and QS = 3P a

Qd = 1000 - 2P

Qs = 600

a. What is the equilibrium price and quantity?

Equilibrium price and quantity is given by equating the quantity demanded and quantity supplied.

1000 - 2P = 600

Or, P = 400 / 2

Or, P = 200

Qd = 1000- 400

= 600

Hence the equilibrium price is 200 and quantity demanded is 600.

b. At a price of $100, will there be a shortage or a surplus, and how large will it be? At a price of $300, will there be a shortage or a surplus, and how large will it be?

At P = 100, Qd = 800

Qs = 300

Thus, there is a shortage of 500.

At P = 300

Qd = 400

Qs = 900

Thus, there is a surplus of 500.