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Inverse Functions

Managerial Economics

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kalix ramirez
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19 views7 pages

Inverse Functions

Managerial Economics

Uploaded by

kalix ramirez
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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To get inverse demand function

Qx = 6060 – 3Px
3Px = 6060 – Qx
3 3
Px = 2020 – 1/3Qx
0 = 2020 – 1/3Qx
1/3Qx = 2020
1/3 1/3
Qx = 6060

Px = 2020 – 1/3Qx
Px = 2020 – 1/3(0)
Px = 2020 – 0
Px = 2020

Px = 2020 – 1/3Qx
1000 = 2020 – 1/3Qx
1/3Qx = 2020 – 1000
1/3Qx = 1020
1/3 1/3
Qx = 3060

DEMAND SCHEDULE
Px Qx
0 6060
500
1000 3060
1500
2020 0
GRAPH DEMAND CURVE
To get inverse supply function
Qx = 3Px - 400
-3Px = -400 – Qx
-3 -3
Px = 400/3 + 1/3Qx
0 = 400/3 + 1/3Qx
-1/3Qx = 400/3
-1/3 -1/3
Qx = -400

Px = 400/3 + 1/3Qx
Px = 400/3 + 1/3(0)
Px = 400/3 + 0
Px = 400/3

Px = 400/3 + 1/3Qx
Px = 400/3 + 1/3(800)
Px = 400/3 + 800/3
Px = 1200/3
Px = 400

SUPPLY SCHEDULE
Px Qx
0 -400
400/3 0
400 800
GRAPH THE MARKET SUPPLY

EQUILIBRIUM
Qd = Qs
10 – 2P = 2 + 2P
10 – 2 = 2P + 2P
8 = 4P
4 4
2 = Pe
6 = Qe
Qd=10 – 2P = 10 – 2 (2) = 10-4 =6
Qs = 2 + 2P = 2+2(2) = 2+4 = 6

Qd = 50 -3P
Qs = 25 +2P
50 -3P = 25 +2P
50 – 25 = 2P + 3P
25 = 5P
5 5
5 =Pe
35 =Qe
Qd = 50 -3P = 50 -3(5) = 50 -15= 35
Qs = 25 +2P = 25 +2(5) = 25 +10 = 35
Qd = 50 -3P = 50 -3(0) -50-0 =50
Qd = 50 -3P = 50 -3(5) -50-15 =35

Qs = 25 +2P = 25 +2 (0) = 25
Qs = 25 +2P = 25 +2 (5) = 25 +10 = 35

Demand and Supply Schedule


Px Qd Qs Surp Shor Prod
0 50 25 25 inc by 25 units
5 35 35 0
10 20 45 25 dec by 25 units
15 5 55 50 dec by 50 units
P
15 S

10

5 D
0 10 20 30 40 50 60 Q

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