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Write the inverse demand function

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Economic

Suppose Avinash consumes tea and coffee. His demand for tea is given by qt = m-20pt+20pc, where m is the income, pt is the price of tea, pc is the price of coffee and qt is his consumption of tea. Avinash's income is Rs. 1000 and the price of coffee is Rs. 10.

a. Write the inverse demand function for tea and plot it on a graph

b. Suppose the prices of coffee and tea are both equal to Rs.10 and income is m. Write down an expression for the engel curve and draw it on a graph.

c. Is coffee a substitute for tea or a complement? Explain your answer.

Reference no: EM133273889

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