[3 x 5=15]
1. In the following behavioural equations of the mnarket, Illustrate the meaning of intercept
and slope. [a] D = 35 - 65P [b] S=-14+ 03 P

Let's examine the equations of the market, which represent the demand (D) and supply (S) curves.

### [a] Demand Curve: \( D = 35 - 65P \)
This equation is in the form of a linear equation: \( D = a + bP \), where:
- \( D \) is the quantity demanded.
- \( P \) is the price.
- \( a = 35 \) is the intercept.
- \( b = -65 \) is the slope.

#### **Intercept**:
The intercept in the demand equation, \( a = 35 \), represents the quantity demanded when the price \( P = 0 \). In this case, if the price were zero, the demand would be 35 units. 

#### **Slope**:
The slope in the demand equation, \( b = -65 \), represents the rate of change in demand concerning price. It means that for each 1 unit increase in price, the quantity demanded decreases by 65 units. The negative sign indicates an inverse relationship between price and demand (as price increases, demand falls).

### [b] Supply Curve: \( S = -14 + 0.3P \)
This equation is also in the form of a linear equation: \( S = c + dP \), where:
- \( S \) is the quantity supplied.
- \( P \) is the price.
- \( c = -14 \) is the intercept.
- \( d = 0.3 \) is the slope.

#### **Intercept**:
The intercept in the supply equation, \( c = -14 \), represents the quantity supplied when the price \( P = 0 \). Here, if the price were zero, the supply would be negative (-14), which might not make practical sense in real-world terms. This negative intercept might indicate that suppliers require a positive price to start supplying goods, or it could imply fixed costs or constraints in the production process.

#### **Slope**:
The slope in the supply equation, \( d = 0.3 \), represents the rate of change in supply with respect to price. It means that for each 1 unit increase in price, the quantity supplied increases by 0.3 units. The positive sign indicates a direct relationship between price and supply (as price increases, supply increases).

### Key Concepts:
- **Intercept** (in both cases) is the point where the curve intersects the vertical axis (price = 0), representing the starting quantity (demand or supply) with no price influence.
- **Slope** measures how steep the curve is, reflecting the sensitivity of demand or supply to changes in price.

### Do you need further clarification on this? Here are some related questions to deepen your understanding:

1. What is the economic interpretation of a negative slope in a demand curve?
2. How would the demand curve change if the intercept increased from 35 to 50?
3. Can the supply curve have a negative slope? What would that imply?
4. How does a steep slope in the supply curve impact market dynamics?
5. How would equilibrium price and quantity be calculated from these equations?

#### **Tip**: Remember, the slope of the demand and supply curves helps determine elasticity—how sensitive quantity is to price changes!

In the following behavioral equations of the market, Illustrate the meaning of intercept and slope. [a] D = 35 - 65P [b] S=-14+ 0.3P

Explore the meaning of slope and intercept in market equations with the demand curve D = 35 - 65P and supply curve S = -14 + 0.3P. This guide provides a detailed breakdown of linear equations and economic interpretations, suitable for students in Grades 9-12.

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