Answer:
0.32 %
Explanation:
Demand is the quantity that buyers are able & willing to buy, at a particular price & period of time. It is inversely related to price, as per law of demand.
Demand function is a regression equation that shows the relationship between dependent variable (demand) & independent variable (price)
Q = A - BP
where Q = Demand, A = Autonomous Demand, P = Price, B = Change in demand per unit change in price
Change in Quantity = B x Change in Price
Example : Considering Q = 50 - 0.5 P
Q {At previous P} = 50 - 0.5 (8.6) → = 50 - 4.3
= 45.7
Q {At new P} = 50 - 0.5(8.3) → = 50 - 4.15
= 45.85
Change in Quantity = 45.85 - 45.7 → = 0.15
Alternative Method : ΔQ = B x ΔP → = (0.30) x (0.5) → = 0.15
Percentage Change in Quantity = [Change IN Quantity / Old Quantity] x 100
[ΔQ/Q] x 100 → = [0.15 / 45.7] x 100 → = 0.32 %
