Consider the linear demand function, QD $=-36-2\mathrm{.}1$P $+0\mathrm{.}24$Y where QD $=$ quantity demanded, P $=$ selling price, and Y $=$ disposable income, the coefficient of P $($i$.$e$.,-2\mathrm{.}1)$ indicates that $($all other things being held constant$)$

Question $9$Answer

a$.$

for a one percent increase in price, quantity demanded would decline by $2\mathrm{.}1$ percent

b$.$

for a one unit increase in price, quantity demanded would decline by $2\mathrm{.}1$ units

c$.$

for a one unit increase in price, quantity demanded would decline by $2\mathrm{.}1$ percent

d$.$

for a one percent increase in price, quantity demanded would decline by $2\mathrm{.}1$ units