Question

Quantity demanded is 200 units when the unit price is set at $90. The quantity demanded is 1200 units when the unit price is $40. Find the demand equation

Answer 1

Answer:

$Q_n=(2000)-(20)P_n$

Step-by-step explanation:

From the question we are told that:

Initial Quantity demanded Q_1= 200 units

Initial demand price $P_1=\ 90$

Final Quantity demanded $Q_2= 1200 units$

Final demand price $P_2=\ 40$

Generally the  Demand Equation is mathematically given by

 $Q_n=a-bP_n$

Where

a=Other factors affecting price

b=Slope of the demand curve

Therefore

 $Q_1=a-bP_1$

 $200=a-b(90)$

 $Q_2=a-bP_2$

 $1200=a-b(40)$

Comparing both above equations

  $a=2000$

  $b=20$

Therefore the  Demand Equation is mathematically given by

  $Q_n=(2000)-(20)P_n$