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Question
The demand function of a commodity is given as P = 20 + D − D2. Find the rate at which price is changing when demand is 3.
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Solution
Given, P = 20 + D – D2
Rate of change of price = `("dP")/("dD")`
= `"d"/("dD") (20 + "D" - "D"^2)`
= 0 + 1 – 2D
= 1 – 2D
Rate of change of price at D = 3 is
`(("dP")/("dD"))_("D" = 3)`
= 1 – 2(3)
= – 5
∴ Price is changing at a rate of – 5 when demand is 3.
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