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  • Constant-Elasticity Demand Function

  • Direct Demand Function: Quantity as a Function of Price (Q = D(P))

Example of a Constant-Elasticity Demand Function: Q = 5P^-1.4

A firm may face a demand function with constant price elasticity, such as Q=5P−1.4Q = 5P^{-1.4}. For this function, the price elasticity of demand remains constant at 1.4 at every price level. This formula is a specific instance of the general form for constant-elasticity demand, Q=aP−bQ = aP^{-b}, where the elasticity is equivalent to the absolute value of the exponent 'b'. [1, 2]

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Economics

Introduction to Microeconomics Course

The Economy 2.0 Microeconomics @ CORE Econ

Ch.7 The firm and its customers - The Economy 2.0 Microeconomics @ CORE Econ

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