Essay: Calculating the Slope

Sample Essay

The slope is calculated as follows:

Two coordinates were taken as:

P, Q= 20, 8

P, Q= 30, 7

Slope=change in price divided by change in quantity demanded

30-20/8-7= 10/1= 10

Hence, the slope is 10.

c) At a price of 20, the QD is 8

The slope for part c:

20, 8

10, 9

10-20/9-8=-10/1=10

Hence, the slope is 1o.

2) a) The profit maximizing quantity and price is:

TR = (30 – Q) Q TC = 0.5 Q2

MR = 30 – 2Q MC = Q

The profit maximising quantity and price are:

MC=MR

The Price=AR

TR/Q=AR

30Q-Q2=TR

(30Q-Q2)/Q=AR

 

30-Q=AR

30-10=AR

20=AR

20=PRICE

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