2
$\begingroup$

Given a demand curve for a particular commodity, which I'll interpret as a function $p(q)$, the $p$-intercept can be interpreted as the choke price, i.e. the lowest price at which quantity demanded is 0.

Assuming the demand curve eventually intercepts the $q$-axis, the $q$-intercept can be interpreted, by definition, as the quantity demanded by consumers if the commodity were free. In other words, any production level greater than this quantity will necessarily result in excess due to the fact that consumers won't want more of the commodity even at a price of 0. Is there some term for this theoretical quantity? Something analogous (but opposed) to the notion of the choke price?

I'm a mathematician, and not an economist, so my economics vocabulary is fairly limited. I was reading about the notion of "market saturation" which seems related but not quite what I'm looking for. Thanks in advance!

$\endgroup$
3
$\begingroup$

There isn't usually a name for this, but we could borrow from the theory of the individual consumer the term satiation point.

| improve this answer | |
$\endgroup$

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.