The Demand equations of the two consumers are given as
$\left.\begin{array}{l}
d 1(p)=10-2 p \\
d 2(p)=20-8 p
\end{array}\right]$
Where d is the demand and p is the price
Calculate the market demand when price is ₹2
Answer & explanation
Correct answer: option 4
To find the market demand, you need to add the individual demands of the two consumers at the given price.
Given demand equations:
d1(p)=10−2p
d2(p)=20−8p
To find the market demand (D(p)), you add d1(p) and d2(p):
D(p)=d1(p)+d2(p)
D(p)=(10−2p)+(20−8p)
D(p)=10−2p+20−8p
D(p)=30−10p
Now, substitute p=2 into the equation to find the market demand at the price of ₹2:
D(2)=30−10(2)
D(2)=30−20
D(2)=10