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30 December, 09:15

A company makes greeting cards and their research shows that that price and demand are related linearly: p = m x + b. They know that for every additional card they wish to sell they need to drop the price by $0.10. They also know that in order to sell 320 cards they need to set the price at $5. Find the linear equation relating price to demand.

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  1. 30 December, 09:43
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    Answer: p = (-0.10) x + 37

    Explanation:

    Given that,

    A company's research shows that,

    Linear equation: p = m x + b

    For every additional card sold, price falls by (m) = - $0.10

    Price (p) = $5

    Cards sold (x) = 320 cards

    Therefore,

    p = m x + b

    5 = - 0.10 * 320 + b

    b = 37

    Hence, linear equation relating price to demand is as follows:

    p = (-0.10) x + 37
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