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5 May, 09:45

Assume a demand equation for good 'x': Q = 9 - 0.1p - p_y + 0.01p_z + 0.0005Y; where p = own price of the good Q = quantity demanded p_y = price of a related good = $3 p_z = price of a different related good = $200 Y = consumer income = $4,000/mo. The quantity demanded as a function of the price can be written:

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  1. 5 May, 13:10
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    Q = 10 - 0.1p

    Explanation:

    Given that,

    Demand equation for good 'x':

    Q = 9 - 0.1p - p_y + 0.01p_z + 0.0005Y

    Where,

    p = own price of the good

    Q = quantity demanded

    p_y = price of a related good = $3

    p_z = price of a different related good = $200

    Y = consumer income = $4,000/month

    Therefore, the quantity demanded as a function of the price can be written as follows;

    Q = 9 - 0.1p - p_y + 0.01p_z + 0.0005Y

    Q = 9 - 0.1p - 3 + 0.01 (200) + 0.0005 (4,000)

    Q = 6 - 0.1p + 2 + 2

    Q = 10 - 0.1p
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