Question
Basil's marginal value of strawberries is MVB = 40 - 0.5Q, where Q is the number of strawberries he eats per day and MV is
Basil's marginal value of strawberries is MVB = 40 - 0.5Q, where Q is the number of strawberries he eats per day and MV is measured in cents/berry. Clara's marginal value of strawberries is MVC = 20 - 0.5Q, where Q is the number of strawberries she eats per day and MV is measured in cents/berry. Every morning Basil picks 20 strawberries in his garden & Clara picks 40 strawberries in hers - these are their endowments = the number of strawberries that ripen by that morning. They trade. Find the equilibrium price at which they trade and find how many strawberries Basil buys from Clara daily. Show your work
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