At a price of $3.00 per gallon, the average weekly demand by consumers for gasoline is 40 gallons. If the price rises to $3.05, the weekly demand drops to 35 gallons. Assuming demand is linear, let
, where Q is the weekly quantity of gasoline demanded and p is the price per gallon. What is the economic interpretation of the Q-intercept?
A) The number of gallons demanded if gas were free.
B) The the price at which no gasoline will be demanded.
C) The amount the demand decreases if the price rises $1.
D) The amount the price decreases if the demand is increased by 1 gallon.

Question

At a price of $3.00 per gallon, the average weekly demand by consumers for gasoline is 40 gallons. If the price rises to $3.05, the weekly demand drops to 35 gallons. Assuming demand is linear, let
, where Q is the weekly quantity of gasoline demanded and p is the price per gallon. What is the economic interpretation of the Q-intercept?
A) The number of gallons demanded if gas were free. 
B) The the price at which no gasoline will be demanded. 
C) The amount the demand decreases if the price rises $1. 
D) The amount the price decreases if the demand is increased by 1 gallon.

Quizplus · Accepted Answer

The Answer of At a price of $3.00 per gallon, the average weekly demand by consumers for gasoline is 40 gallons. If the price rises to $3.05, the weekly demand drops to 35 gallons. Assuming demand is linear, let
, where Q is the weekly quantity of gasoline demanded and p is the price per gallon. What is the economic interpretation of the Q-intercept?
A) The number of gallons demanded if gas were free. 
B) The the price at which no gasoline will be demanded. 
C) The amount the demand decreases if the price rises $1. 
D) The amount the price decreases if the demand is increased by 1 gallon.

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