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Unformatted text preview: the contrary the curve intersects OX axis at point B showing largest quantity demanded where price is zero. Both OA and OB are said to be intercept quantities when one of the variables assumes zero value. Note that demand curve is sloping downward. This follows the law of demand (given below). But the demand curve of such a shape is obvious from the fact that quantities demanded and price in the demand schedule hold an inverse relationship . Quantity Demanded q d figure 2 Demand Function: The price-demand relationship shown above can be expressed in the form of a demand function as follows: q d = 10 - 3P On substitution of any scheduled value of P we get the relevant value of the quantity demanded. Thus when P = 1 then q d =10 - 3 (1) = 7 or when P = 3, then q d = 10 - 3 (3) = 1 etc....
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This note was uploaded on 11/17/2011 for the course EC ec 201 taught by Professor - during the Fall '10 term at Montgomery.
- Fall '10