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John Moffat.
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- November 13, 2018 at 2:31 pm #484705
If a demand is 5000 units when price is 400 and 6000 when the price is 380 what will be demand equation?
I am getting A =300 whereas answer is 500-0.2q in revesion kit, I have taken b as -0.02, IS it the reason?I think I have to ignore the minus sign to get the correct answerNovember 13, 2018 at 3:07 pm #484716Yes – you should have ignored the minus.
However, think about it – you should have realised that your answer could not possibly have been correct. As you know from the formula sheet, A is the price for which the demand is zero. Given that at a price of 400 the demand is 5,000 then A has to be more than 400 for the demand to be zero!!
I do suggest that you watch my free lectures on this – I go through examples of how to calculate B and A.
The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.November 13, 2018 at 3:19 pm #484717thankyou very much for quick response,I figured it out but just wanted to confirm.
November 14, 2018 at 5:46 pm #484820You are welcome 🙂
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