Fora linear demand curve, d (p) = a – bp; 0 < p < a/b = 0; p> a/b 1

1.	Fora linear demand curve, d (p) = a – bp; 0 < p < a/b = 0; p> a/b 1. State the meaning of ‘a’ and -b? 2. What does the slope of the demand curve mean?
Answer» 1. In the equation of linear demand curve, ‘a’ is the vertical intercept and-b is the slope of the demand curve. 2. The slope of the demand curve measures the rate at which demand changes with respect to its price.

Fora linear demand curve, d (p) = a – bp; 0 < p < a/b = 0; p> a/b 1. State the meaning of ‘a’ and -b? 2. What does the slope of the demand curve mean?

Answer»

1. In the equation of linear demand curve, ‘a’ is the vertical intercept and-b is the slope of the demand curve.

2. The slope of the demand curve measures the rate at which demand changes with respect to its price.