Inverse Supply

The inverse supply curve represents the price as a function of the quantity supplied.

Example

The supply for cookies follows the following equation: `Q_s = 10 + 2P`.

Solving for P:

$$ \begin{align*} Q_s &= 10 + 2P \\ 2P &= Q_s - 10 \\ P &= \frac{Q_s - 10}{2} \end{align*} $$ The inverse supply is `P = \frac{Q_s - 10}{2}`

Question

The supply for bananas follows the equation `Q_s = 364 + 91 P`.

Find the inverse supply function.

Determine the price of bananas when the quantity supply is 2912.

Let's transform the supply function into the inverse supply function.

$$ \begin{align*} Q_s &= 364 + 91 P \\ 91 P &= Q_s - 364 \\ P &= \frac{364 - Q_s}{91} \end{align*} $$

The inverse supply function is `P = \frac{364 - Q_s}{91}`.

If the quantity supplied is 2912, then

$$ P = \frac{364 - 2912}{91} = 28 $$

The price producers get for a banana is $28.