Hello everybody
I am trying to solve this examination assignment. I feel like I do everything right, but the result just does not seem right.
Within a 6 month period the Demand can be described as follows:
Upper line segment (Q ; P) = (1.000 ; 305) and (2.000 ; 230)
Lower line segment (Q ; P) = (2.212,5 ; 147,5) Ep = - 1/3
I need to find the MR- and P-function
I calculate the two P functions to be the following:
Upper line segment: P = -0,075Q+380
Lower line segment: P = -0,2Q+590
And the MR functions
Upper line segment: MR = -0,15Q+380
Lower line segment: MR = -0,4Q+590
The intersept between Pupper and Plower is (254;1680)
MRupper intersept P=0 at (0;2533)
MRlower intersept P=0 at (0;1475)
And this just does not seem right to me.
To my knowledge, the kinked demand curve can't be solved unless both MR intersept with P=0 Q<1680
Can anyone help me?
/Dyregod
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