Steve S. answered • 01/21/14

Tutor

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Tutoring in Precalculus, Trig, and Differential Calculus

. 1 . . . . . . . . . 1

. 1.1 . . . . . . . . 0.95

. 1.15 . . . . . . . .???

Use Point-Slope Form equation of a line:

y - 1 = ((1.1-1)/(0.95-1))(x - 1)

We want to know what x is if y = 1.15:

x - 1 = (1.15 - 1)*(-0.05)/0.1

x - 1 = (0.15)*(-5)/10

x = 1 - 0.15/2

x = 1 - 0.075

x = 1 - 7.5%

So a 7.5% decrease in price will increase demand by 15%.