The constant or intercept term in a statistical demand study represents the quantity demanded when all independent variables are equal to: 1.0 their minimum values their average values <u>0.0 </u>The demand equation is written as;
Qd is the demand quantity
p is price
a is the intercept
b is the slope of the demand curve.
Demand is the dependent variable and its influenced by independent variables such as price and consumer income. The intercept therefore represents the quantity demanded when the independent variables are equal to zero.
<h3>What is
independent variables?</h3>
In mathematical modeling, statistical modeling, and experimental sciences, there are dependent and independent variables. Dependent variables get their name because, during an experiment, their values are examined under the assumption or requirement that they are dependent on the values of other variables due to some law or rule (for example, a mathematical function). In the context of the experiment in question, independent variables are those that are not perceived as dependant on any other factors. Time, space, density, mass, fluid flow rate, and historical values of some observed value of interest (such as the number of the human population) are some examples of typical independent variables that can be used to forecast future values (the dependent variable).
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