product selling price of $620, consumers are willing to buy 95 of it. If the price is $275 they are willing to buy 230 units. Find the demand equation

Question

How do I do this

Answer 1

The slope of the demand line is M =  (230 -95)/(275 - 620) = -0.391304348...

 I will refer to this slope as M without typing and re-typing this outrageous decimal number.

 Store this value in the memory of you calculator.

 

y = M x + b is the equation of any line, where M is the slope as calculated above.

 

solving for B and using the given data

b = y - Mx ;  

  

   (620,95)---> b = 95 - M*620 ---> b = 337.608695652174

 

  (275,230) ---> b = 230 - M*275  produces the same result

 

So the slope and intercept of the demand line are highlighted in bold above:

 

  y = M x + b

 

 

At this rate, when the price hits -b/M =  862.77, no one will buy any of it.