Suppose the observed annual quantity of steel exchanged in the European market is 30 million metric tons, and the observed market price is 90 euros per ton. If the linear demand function for steel takes the form Q = a - 0.9P, what is an appropriate value for the intercept coefficient a?
A) a = -51
B) a = 51
C) a = 111
D) a = -111

Question

Quizplus · Accepted Answer

Given, 
Q = 30 million tons
P = 90 euros/ton
Q = a - 0.9P
Substituting Q and P in the equation, we get
30 = a - 0.9 * 90
30 = a - 81
a = 30 + 81
a = 111
Therefore, the appropriate value for the intercept coefficient a is 111.

Suppose the Observed Annual Quantity of Steel Exchanged in the European