A firm's demand curve is given by Q = 800

Question

A firm's demand curve is given by Q = 800 - 2P, where P = price and Q = quantity. Therefore, its inverse demand equation is:
A) MR = 800 - 4P
B) P = 800 - 2Q
C) P = 400 - .5Q
D) P = 800 - .5Q
E) 800 = Q + 2P

Quizplus · Accepted Answer

To find the inverse demand equation, solve the given demand equation for P. Starting with Q = 800 - 2P, rearrange to get P on one side: 2P = 800 - Q, then divide everything by 2 to isolate P: P = 400 - 0.5Q.