Problema Solution
The quantity demanded x for a certain brand of MP3 players is 300 units when the unit price p is set at $90. The quantity demanded is 1300 units when the unit price is $40. Find the demand equation.
Answer provided by our tutors
We will assume that the demand equation is linear:
x = ap + b, where a and b are constants
We are given two points of the line: (90, 300) and (40, 1300), thus we can write:
90a + b = 300
40a + b = 1300
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click here to see the system of equations solved for a and b
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a = -20
b = 2100
The demand equation is:
x = -20p + 2100