(Answered) The inverse demand function for water w among urban users

Economics

The inverse demand function for water w among urban users is given by Du(w) = 10-2(w), and the inverse demand function for water among rural users is given by Dr(w) = 6-w. The total amount of water available is W=5.

a. What is the efficient allocation of water to the two groups of users: urban and rural?

b. What is the efficient price for water? Why?

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