Determine special but convenient case of linear demand

Reference no: EM13177760

The demand schedule (or demand function or curve) for a good shows the total quantities (Q) that buyers are willing and able to buy at various prices (P) in some period of time. For example, here is a demand function illustrating the very special but convenient case of linear demand (with
Q measured in some physical unit of quantity such as tons and P measured in dollars):
Q = 2100 - 50P
Sometimes it is convenient to express this in the inverse form showing the prices that buyers are willing to pay for various quantities. (P is a function of Q.) This is called the demand-price function.

a. State the demand-price function corresponding to the above demand function.

b. Plot the corresponding demand curve on graph paper - with Q on the horizontal axis and P on the vertical axis. Label this demand D1.
I. The Case of Fixed Supply
A supply schedule (or function or curve) defined analogously shows the total quantities (Q) that sellers are willing to sell at various prices (P) in a given period of time. One very special case is that of a fixed supply, where the quantity supplied is a constant, independent of price, such as
Q = 1200 (This type of supply may apply, for example, in the short period of time when a given quantity of a perishable commodity is brought to market and must be sold at any price or go to waste; or, in a slightly different meaning of supply, again in the short run, it may apply to a service such a=/ousing, or even in the long run to the services of a permanent resource such as land.)

Reference no: EM13177760

Questions Cloud

Find the mass of a wire formed by the intersection : Find the mass of a wire formed by the intersection of the sphere x^2 + y^2 + z^2 = 1 and the plane x + z=0 if the density of a wire is x^2?

Draw the indifference curve : Draw the indifference curve for U = 20. For what values of p1/p2 will the optimum be \(x_{1} = 0\) If neither x1 and x2 is equal to zero and the optimum is unique, what must be the value of x1/x2?

Find the expression for the surface area of the box in terms : a box with no lid is created from a square of cardboard with a side length of 60 cm by cutting rectangles of length x by 2x from each corner (the extra side length of this square of 2x is folded over to create a double thickness side for added str..

How fast is oa changing : Points A and B move along the x- and y-axes, respectively, in such a way that the perpendicular distance r from the origin to AB remains constant. How fast is OA changing, and is it increasing or decreasing, when OB=2r and B is moving toward O at ..

Determine special but convenient case of linear demand : The demand schedule (or demand function or curve) for a good shows the total quantities (Q) that buyers are willing and able to buy at various prices (P) in some period of time. For example, here is a demand function illustrating the very special ..

What point does the path approach : Let f(x,y) = 1 - x2 - 2y2 and let S be the surface z = f(x,y). Parametrize the path of steepest ascent up S starting from the point (2, 1, -5). What point does the path approach?

What is the probability of e : what is the probability of not drawing a black card which is an Ace, a Two or a Three?

What is the maximum possible profit : A chain store manager has been told by the main office that daily profit, P, is related to the number of clerks working that day, x, according to the function P=-25x^2+300x. What number of clerks will maximize the profit, and what is the maximum p..

User Account

All Pages