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A General Linear Demand Function Has the Form to Follow q=kp+bq = k p + b

Question 21

Multiple Choice

A general linear demand function has the form to follow. q=kp+bq = k p + b (k and b constants, with k0k \neq 0 )

Obtain a formula for the elasticity of the demand at a unit price p.


A) E=pk+bE = - \frac { p } { k + b }
B) E=b+kpE = b + k p
C) E=kpkp+bE = - \frac { k p } { k p + b }
D) E=kpbE = \frac { k p } { b }
E) E=pp+bE = - \frac { p } { p + b }

Correct Answer:

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