At the equilibrium price, quantity supplied equals quantity demanded:
3Q + 40 = –5Q + 200
8Q = 160
Q = 20, which is the equilibrium quantity.

P = 3(20) + 40 = 100; or, P = –5(20) + 200 = 100. The equilibrium price is 100.

Because a price below 100 results in excess demand, we can rule out the answer choice “At a price of 70, excess supply is 16” and choose the correct answer with no further calculations.

At a price of 130:
130 = –5QD + 200
5QD = 70
QD = 14

130 = 3QS + 40
3QS = 90
QS = 30

Excess supply at a price of 130 = QS – QD = 30 – 14 = 16.

At a price of 70:
70 = –5QD + 200
5QD = 130
QD = 26

70 = 3QS + 40
3QS = 30
QS = 10

Excess demand at a price of 70 = QD – QS = 26 – 10 = 16.