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The demand of a particular product decre...

The demand of a particular product decreases as the price goes up. A company researched that when the product price is $45, the demand for the product is 1000. For every $5 increase in the price of the product, the demand falls by 15. What will be the demand for the product when the price is set at $80?

A

890

B

895

C

985

D

995

Text Solution

AI Generated Solution

The correct Answer is:
To solve the problem step by step, we can follow these calculations: ### Step 1: Identify the initial conditions - Initial price of the product (P1) = $45 - Initial demand for the product (D1) = 1000 units ### Step 2: Determine the new price - New price of the product (P2) = $80 ### Step 3: Calculate the price increase - Price increase = P2 - P1 = $80 - $45 = $35 ### Step 4: Determine how many $5 increments are in the price increase - Number of increments = Price increase / Increment amount = $35 / $5 = 7 increments ### Step 5: Calculate the total decrease in demand - Demand decreases by 15 units for each $5 increase in price. - Total decrease in demand = Number of increments × Decrease in demand per increment = 7 × 15 = 105 units ### Step 6: Calculate the new demand - New demand (D2) = Initial demand - Total decrease in demand = D1 - Total decrease = 1000 - 105 = 895 units ### Conclusion The demand for the product when the price is set at $80 is **895 units**. ---
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