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The demand for your products is a broken demand function.

At a lower quantity than you currently sell, one demand line is valid, but another is valid if the quantity is more than you currently sell.
The demand curves are: P = -0.3Q+39 and P = -0.8Q+65
What quantity will you sell if you raise the price by 10%?

User Kivanc
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1 Answer

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Final answer:

Without specific initial values for the quantity and price, we cannot calculate the exact quantity that will be sold after a 10% price increase using the given broken demand curves. Graphical representations can be a useful method to visualize and solve such problems. Typically, a price increase results in a lower quantity demanded according to the demand curve.

Step-by-step explanation:

To find the quantity you will sell if you raise the price by 10% using the given broken demand function curves P = -0.3Q+39 and P = -0.8Q+65, it involves a few steps of calculations. Firstly, you need to determine the initial equilibrium price by setting P equal in both equations and then solving for Q. However, the question does not specify which demand curve applies before the price increase, nor does it provide the initial quantity or price to calculate the new quantity after a 10% price increase.

Without this information, we can't provide an accurate new quantity value. Typically, a 10% price increase would move along the demand curve, resulting in a lower quantity demanded. The exact new quantity can be found by identifying the initial price and quantity, increasing the price by 10%, and then solving the demand curve equation for the new quantity demanded.

Considering the broken demand function, it is also important to know at which price the demand function shifts from one equation to another.

Solving Models with Graphs can be helpful here. Graphing the demand curves can illustrate where the new price would intersect the demand curve and help visualize the change in quantity demanded.

User Nitz
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