Suppose the demand for Digital Video Recorders (DVRs)is given by Q = 250 - .25p + 4p_c,where Q is the quantity of DVRs demanded (in 1000s),p is the price of a DVR,and p_c is the price of cable television.How much does the quantity demanded for DVRs change if the p rises by $40? A)drops by 10,000 DVRs B)increases by 16,000 DVRs C)drops by 2,500 DVRs D)increases by 4,000 DVRs

Question

Quizplus · Accepted Answer

The demand equation shows that for every $1 increase in p, Q decreases by 0.25. Therefore, if p rises by $40, the quantity demanded decreases by 0.25 * 40 = 10,000 DVRs.

Suppose the Demand for Digital Video Recorders (DVRs)is Given by Q