Answer to Question #196755 in Microeconomics for selina

Question

buyers in the chocolate market demand 200 units of chocolate when price is zero and decrease the purchase of chocolates by 2 units for every one unit increase in price. write down the equation of the demand function in the form of Q= f(P)

Answer 1

In its standard form a linear demand equation is Q = a - bP. That is, quantity demanded is a function of price. 

$P= 0 , Q = 200 .... ( Point 1)$

$P= 1 , Q = 198 ......(point 2)$

$Q = a - bP$

When we put point 1 , we get 

$a = 200$

When we put point 2 , we get 

$198 = 200 - b$

$b = 2$

Therefore the equation becomes, 

$Q = 200 - 2P$