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A research showed that at a price of $250 per unit, sales would be 6,000 units per month and would reduce by 500 per month for each $ rise in price.
Mr.mofat please explain it for me I am not getting this this is how they got the 260 i thought of using an assumption figure this is how the kit solved the
equation
250=a-6000b
260=a-5500bYou need to watch my free lectures on pricing, because I go through how to arrive at the price demand equation in detail.
If you have copied the question correctly, then 260 has nothing to do with it. The 260 would only be correct if the question said that sales reduce by 500 for each $10 rise in price.
On the question as you have typed it:
b = 1/500 = 0.002
a = 250 + (6,000 x b) = 250 + 12 = 262
(the equations are given on the formula sheet)
(My free lectures are a complete course for Paper F5 and cover everything needed to be able to pass the exam well)
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