question archive A business wants to expand
A business wants to expand
Subject:EconomicsPrice: Bought3
A business wants to expand.
Assume their fixed cost of operation is $100,000 and the marginal cost to sell each unit is $5000. If they change their payment system, to the first-degree price discrimination, the marginal cost per unit increases to $7000.
P= 125-Q Q is the quantity of units sold per month. P is price in 1000s
What price should the business charge under monopoly pricing?
How much monthly profit will it earn?
What quantity will it sell under first-degree price discrimination?
How much monthly profit will it earn?
