question archive A firm that sells e-buoks - books in digital form downloadable from the Internet - sells all e-books relating to do«it-yourself topics (home plumbing, gardening, and so on) at the same price

A firm that sells e-buoks - books in digital form downloadable from the Internet - sells all e-books relating to do«it-yourself topics (home plumbing, gardening, and so on) at the same price

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A firm that sells e-buoks - books in digital form downloadable from the Internet - sells all e-books relating to do«it-yourself topics (home plumbing, gardening, and so on) at the same price. At present, the company can earn a maximum annual pro?t of $35,000 when it sells 10,000 copies within a year's time. The ?rm incurs a 75-cent expense each time a consumer downloads a copy. but the company must spend $140,000 per year developing new editions of the e-books. The company has determined that it would earn zero economic pro?ts if price were equal to average total cost, and in this case it could sell 35,000 copies. Under marginal cost pricing, it could sell 115,000 copies. In the short run, to the nearest cent, what is the pro?t-maximizing price 01 e-books relating to do-it—yourself topics? $D.

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