Question

Consider the mango market in San Lorenzo composed of three Bokononists with individual, inverse demand functions given by:

Bokononist #1 ? = 100 − 2q₁

Bokononist #2 ? = 80 − 2q₂

Bokononist #3 ? = 60 − 2q₃

First, determine the equation for inverse market demand. If the equation is a piecewise function, make sure that you correctly specify each “piece” of inverse market demand, including identifying all “kink” points! Also, if the price of mangos in San Lorezno changes from ? = 55 to ? = 65, what happens to the quantity of mangos purchased in the San Lorenzen mango market?

Answer 1