For the demand equation, P = 2,000 – 2Q, answer the following:

Question

For the demand equation, P = 2,000 – 2Q, answer the following:

a. What is the vertical intercept?

b. What is the horizontal intercept? Must show calculations.

c. What is the slope?

Answer 1

a. The price (P) is on the vertical axis. So, when quantity (Q) =0, then you get the vertical intercept.

Use the equation and set Q=0.

You get: P = 2000 - 2. (0)

=> P = 2000 ---> This is you vertical intercept.

b. Similarly, the horizontal intercept is obtained by setting P=0

You get: 0 = 2000 - 2.Q

=> 2000 = 2.Q

=> Q = 1000. ---> This is you horizontal intercept.

C. You can find the slope by differentiation P with respect to Q.

dP/dQ = -2 which is the slope.

OR - You could just remember to arrange the equation as P = a + b.Q. Then b will be your slope.