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Problem: Demand for cases of almond milk are split up into two groups: youths y and adults a . The inverse demand functions as well as the inverse supply function is provided below where p is the price; and Qd,y and Qd,a are the quantities demanded for youths and adults.
Dy:p = 30 - 1/4
Qd,y: p = 20 - 1/2
Qd,a S: p= 1/2Qs
Required:
Question 1: Derive market demand function.
Question 2: Sketch market demand function and market supply function on a graph. label each curve and any relevant kinks and intercepts.
Question 3: Calculate the free market equilibrium assuming both groups are part of the market and label it on your graph.
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