. Suppose each ice cream truck has a marginal cost of $1.50 per ice cream cone...

. Suppose each ice cream truck has a marginal cost of $1.50 per ice cream cone sold and no fixed cost. Suppose the maximum number of ice cream cones sold by any one truck in a day is 100.

If the price of an ice cream cone is $2, how many ice cream cones does each truck want to sell?
If the industry is perfectly competitive will the price remain at $2 for an ice cream cone? If not, what will the price be?
If each ice cream truck sells exactly 100 ice cream cones a day and the demand for ice cream cones from ice cream trucks in the city is Q = 4400 - 1200P, how many ice cream trucks are there?

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Expert Solution

Rahul Sunny answered 1 week ago

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