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Assume that you are in the business of building houses. You have analyzed the market carefully, and you know that at a price of $120,000, you will...

1. Assume that you are in the business of building houses. You have analyzed the market carefully, and you know that at a price of $120,000, you will sell 800 houses per year. In addition, you know that at any price above $120,000, no one will buy your houses because the government provides equal-quality houses to anyone who wants one at $120,000. You know that for every $20,000 you lower your price, you will be able to sell an additional 200 units. For example, at a price of $100,000, you can sell 1,000 houses, at a price of $80,000, you can sell 1,200 houses, and so on

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