Suppose there are 20 consumers for a good and they have identical demand functions:
d(p) = 10 – 3p for any price less than or equal to 10/3 and d1(p) = 0 at any price greater than 10/3.
What is the market demand function?
d(p) = 10 – 3p if Price ≤ 10/3
d1(p) = 0 if Price > 10/3
Market Demand is total demand of all consumers
For Price ≤ 10/3
Market Demand = 20 (10 – 3p)
= 200 – 60p
For Price > 10/3
Market Demand = 20 (0)
= 0
Therefore, market demand function is
200 – 60p if Price ≤ 10/3
0 if Price > 10/3