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Linear Demand Curve

`Q = "a" - "b" * "P" `
`(a)" Effect on Demand Quantity"`
`(b)" Rate of Change in Demand"`
`(P)" Price"`
Tags
Economics

The Linear Demand Curve calculator computes the Quantity of Demand (Q) based on the general effects on quantity of demand other than price (a), the slope of the effect of price changes on demand (b) and the price (P)./attachments/e6d2f198-da27-11e2-8e97-bc764e04d25f/Demand Curve.png

INSTRUCTIONS: Enter the following:

  • (a) Effect of all influence on demand other than price.
  • (b) Slope of the effect on demand on changes in price.
  • (P) Price of goods.

Quantity of Demand (Q): The calculator returns the quantity

The Math / Science

The formula for the Linear Demand Curve is:

      Q = a - b•P

where

  • Q is the quantity of demand
  • a is the effect of all influences on demand other than price
  • b is the slope of the demand in relationship to the price (P)
  • P is the price

[From WikiPedia] The demand curve is often graphed as a straight line of the form Q = a − b•P where a and b are parameters. The constant "a" embodies the effects of all factors other than price that affect demand. If income were to change, for example, the effect of the change would be represented by a change in the value of "a" and be reflected graphically as a shift of the demand curve. The constant "b" is the slope of the demand curve and shows how the price of the good affects the quantity demanded.

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References