lectures in microeconomics-charles w. upton the mathematics of demand functions

Lectures in Microeconomics-Charles W. Upton

The Mathematics of Demand Functions

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Demand Functions In Different Forms

• Graphs of quantity demanded against price

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• Graphs of quantity demanded against price– They need not be

straight lines

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• Tables Price Quantity

$0.40 100

$0.50 90

$0.60 80



• Mathematical equations

Q=100-2P



• Mathematical equations– Linear or Non

Linear

Q=100-2P

Q=10P-2


Indirect demand functions

• Gives price as a function of quantity, not the other way around.

• We can always restate indirect demand functions as direct demand functions and vice versa.


A Graphical Interpretation

• Knowing price we know quantity demanded.

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A Graphical Interpretation

• It also works the other way.

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Ditto with Tables

Price Quantity

$0.40 100

$0.50 90

$0.60 80


An Example

Q = 100 – 2P


An Example

Q = 100 – 2P

2P + Q = 100 – 2P +2P


An Example

Q = 100 – 2P

2P + Q = 100 – 2P +2P

2P + Q = 100


An Example

2P + Q = 100

2P + Q – Q = 100 – Q

2P = 100 – Q


An Example

2P = 100 – Q

(1/2)[2P] = (1/2)[100-Q]

P = 50 – (1/2)Q


A Second Example

P = 50 – (1/2)Q


A Second Example

P = 50 – (1/2)Q

2P = 2[50-(1/2)Q]

2P = 100 – Q


A Second Example

2P = 100 – Q

Q + 2P = 100 – Q + Q

Q + 2P = 100


A Second Example

Q + 2P = 100 – Q + Q

Q + 2P = 100

Q + 2P – 2P = 100 –2P

Q = 100 – 2P


Some Assignments

P = 12 – 3Q

Q = 100 – 10P


Some Assignments

P = 12 – 3Q

Q = 100 – 10P

Q = 4 – (1/3)P

P = 10 – 0.1Q

lectures in microeconomics-charles w. upton the mathematics of demand functions

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