I just got Mercy, and to effectively use it I need 1,000+ ammo for it. I look for the merchants and they only have about 4 grenade rounds for it. Does anyone have any idea where I can find its ammo? I already looted the place where the Boomers are.

Mick and ralphs, 188, gun runners. Any major trader can have them. The [censored] guy at 188 had alot of missiles last time i checked with him, probably had 40mm's too.

Thanks, but do they have them in large quantities?

The Boomers at Nellis have a lot for sale at a certain point in "Volare!", they sell in the warehouse across from Loyal's warehouse.