Topics
Linear Demand Function
The demand function can be written in the form of an equation
Qa = a = bP where Qd is quantity demanded
- a is a constant – determined by non-price factors
- P is the price of the product
- For example:
- Demand for Product Y = 200 – 4P
If the market price is £40, then Qd = 200 – 160 = 40 units