David can sell 200 printers per day if he charges $70 each. He determines that he...

David can sell 200 printers per day if he charges $70 each. He determines that he will sell an additional 50 printers per day for each $10 reduction in price.

a. Find a linear demand function, p in terms of x.

b. Find the revenue function.

c. How much should he charge for his printers to maximize his revenue?

d. What would be David’s maximum revenue?

e. Suppose David has a fixed cost of $1000 and a marginal cost of $60. Find his cost function.

f. Find his profit function.

g. Find the number of printers to sell to maximize his profit.

h. Find the maximum profit.

i. Find the price to charge to maximize the profit.

Expert Solution

milcah answered 2 years ago

You can sell 70 pet chias per week if they are marked at $1 each, but...

You can sell 70 pet chias per week if they are marked at $1 each, but only 20 each week if they are marked at $2/chia. Your chia supplier is prepared to sell you 10 chias each week if they are marked at $1/chia, and 60 each week if they are marked at $2 per chia. (a) Write down the associated linear demand and supply functions. demand function q(p) = supply function q(p) = (b) At what price should the...

Dave is going to contribute $200 per month on the first day of each month into...

Dave is going to contribute $200 per month on the first day of each month into a retirement account starting today for 30 years. If Dave can earn a monthly rate of 0.5%, the amount he will he have in his retirement account 40 years from now is closest to what value? Yes, you heard me right, Dave is making monthly payments for 30 years (at the beginning of each year), but no payments are made for the last 10...

1. James deposits $200 in a bank account on the last day of each month. He...

1. James deposits $200 in a bank account on the last day of each month. He increases the deposit by $10 each month. The payments continue for a period of 36 months. What is the present value of these payments on the day of the first payment (to the nearest dollar)? The nominal interest rate is 8% compounded monthly. 2. $1000 accumulates to $1500 in 5 years time and the rate of inflation is 3% p.a. What is the annual...

Suppose that hospitals charge by the day and that the typical hospital charges $1000 per day...

Suppose that hospitals charge by the day and that the typical hospital charges $1000 per day but some charge more and some charge less, and that insured consumers can choose any hospital. What do you think of this argument? “With respect to consumer incentives about use of hospital care there is no difference between a $100 per day copayment and 10 percent coinsurance.”

A coffeeshop determines that it can sell 40004000 cups of coffee at a price of $2.252.25,...

A coffeeshop determines that it can sell 40004000 cups of coffee at a price of $2.252.25, but for every $1 increase in the price, their sales will decrease by 5600 cups and for every $1 decrease, their sales will increase by 5600 cups. A function giving the revenue earned when the price of coffee is xx dollars per cup is R(x)=R(x)= The coffeeshop can earn a maximum of when the price of a cup of coffee is $ (round your answers to...

A barber charges $12 per haircut and works Saturday through Thursday. He can perform up to...

A barber charges $12 per haircut and works Saturday through Thursday. He can perform up to 20 haircuts a day. He currently performs an average of 12 haircuts per day during the weekdays (Monday through Thursday). On Saturdays and Sundays, he does 20 haircuts per day and turns 10 potential customers away each day. These customers all go to the competition. The barber is considering raising his prices on weekends. He estimates that for every $1 he raises his price,...

Suppose that BYOB charges $2.50 per can

Profit maximization and loss minimization BYOB is a monopolist in beer production and distribution in the imaginary economy of Hopsville. Suppose that BYOB cannot price discriminate; that is, it sells its beer at the same price per can to all customers. The following graph shows the marginal cost (MC), marginal revenue (MR), average total cost (ATC), and demand (D) for beer in this market. Place the black point (plus symbol) on the graph to indicate the profit-maximizing price...

In his current job, Jake can work as many hours per day as he chooses and...

In his current job, Jake can work as many hours per day as he chooses and is paid $10 per hours. Faced with this wage schedule, he chooses to work 12 hours per day. A law has just been passed requiring employers to pay double wages for any hours in excess of 8 hours. True/False: Assuming that leisure is a normal good for Jake, he will certainly work more than 12 hours per day. With the use of an appropriate...

David gets $90 per month as an allowance to spend any way he pleases. Because he...

David gets $90 per month as an allowance to spend any way he pleases. Because he likes only peanut butter and jelly sandwiches, he spends the entire amount on peanut butter (at $1 per ounce) and jelly (at $2 per ounce). Bread is provided free of charge by a concerned neighbor. David is a picky eater and makes his sandwiches only one way-- with exactly one ounce of peanut butter and two ounces of jelly. You can use increments of...

Short-term loan charges 2.05% Interest per day. APR: EAR:

Question