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Question What is always true about the quadratic form of the following demand function: demand -a +b* pricecprice2: A. b is negative, c is positive B. b is positive, c is negative C. b is negative, c is negative D. b is positive, c is positive E. None of above ect in cPortfolio Activity Details
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Answer #1

Demand is expected to go down with an increase in prices. So price or price squared should be expected to cause the demand to go down.

As a result of the above, the coefficients "b" and "c" should be negative.

So the correct answer is C) b is negative, c is negative

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