Question

Chapter 2 Questions 1,2,3

PROBLEMS 1. Given the following demand schedule of a 4. commodity: P(S) 6 5 4 3 2 1 0 QD 0 10 20 30 40 50 60 Show that by substituting the prices given in the function, you obtain the corresponding quantities OD 60 10P table into the following demand equation or demanded given in the table: *2. Derive the demand schedule from the following demand function: OD' 80- 10P 3. On the same graph, plot the demand schedule of Problem 1 and label it D and the demand curve of Problem 2 and label it D'. Does D' represent an increase in demand or an increase in the quantity demanded? Why?

Answer 1

1.

Demand Scheduled

Price	QD = 60 - 10P	Quantity
$ 6	60 - 10*6 = 60 - 60= 0	0
5	60 -10*5 = 60 - 50 = 10	10
4	60 - 10*4 = 60 - 40 = 20	20
3	60 - 10*3 = 60 - 30 = 30	30
2	60 - 10*2 = 60 - 20 = 40	40
1	60 - 10*1 = 60 - 10 = 50	50
0	60 - 10*0 = 60	60

2. Given, Q_D^' = 80 - 10P

Demand Scheduled

Price	Q = 80 - 10P	Quantity
$ 8	80 - 10*8 = 0	0
7	80 - 10*7 = 10	10
6	80 - 10*6 = 20	20
5	80 - 10*5 = 30	30
4	80 - 10*4 = 40	40
3	80 - 10*3 = 50	50
2	80 - 10*2 = 60	60
1	80 -10*1 = 70	70
0	80 - 10*0 = 80	80

3. The graph I have plotted using excel kindly refer the attached picture

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