In Gas Pump, South Dakota, there are two kinds of consumers, Buick owners and Dodge owners. Every Buick owner has a demand function for gasoline DB(p)=20 − 5p for p ≤ 4and DB(p) = 0 if p> 4. Every Dodge owner has a demand function DD(p)= 15 − 3p for p ≤ 5 and DD(p) = 0 for p> 5. (Quantities are measured in gallons per week and price is measured in dollars.) Suppose that Gas Pump has 150 consumers, 100 Buick owners, and 50 Dodge owners. a. If the price is $3, what is the total amount demanded by each individual Buick Owner? And by each individual Dodge owner? What is the total amount demanded by all consumers in Gas Pump at a price of 3? b. Use ink to draw the demand curve representing the total demand by Buick owners on the graph. Use ink to draw the demand curve representing total demand by Dodge owners. Use ink to draw the market demand curve for the whole town. (make some labels) c. At what prices does the market demand curve have kinks? When the price of gasoline is $1 per gallon, how much does weekly demand fall when price rises by10 cents? When the price of gasoline is $4.50 per gallon, how much does weekly demand fall when price rises by10 cents? When the price of gasoline is $10 per gallon, how much does weekly demand fall when price rises by10 cents?
In Gas Pump, South Dakota, there are two kinds of consumers, Buick owners and Dodge
owners. Every Buick owner has a
DB(p) = 0 if p> 4. Every Dodge owner has a demand function DD(p)= 15 − 3p for p ≤ 5 and
DD(p) = 0 for p> 5. (Quantities are measured in gallons per week and
dollars.) Suppose that Gas Pump has 150 consumers, 100 Buick owners, and 50 Dodge
owners.
a. If the price is $3, what is the total amount demanded by each individual Buick Owner?
And by each individual Dodge owner? What is the total amount demanded by all
consumers in Gas Pump at a price of 3?
b. Use ink to draw the demand curve representing the total demand by Buick owners on the
graph. Use ink to draw the demand curve representing total demand by Dodge owners.
Use ink to draw the market demand curve for the whole town. (make some labels)
c. At what prices does the market demand curve have kinks? When the price of gasoline is
$1 per gallon, how much does weekly demand fall when price rises by10 cents? When
the price of gasoline is $4.50 per gallon, how much does weekly demand fall when price
rises by10 cents? When the price of gasoline is $10 per gallon, how much does weekly
demand fall when price rises by10 cents?
* can YOU explain 'C' part in details
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