Your company produces a unique style of sandals. The table shows price/quantity combinations from the retail demand curve for your sandals. This demand curve for your shoes is linear. Your marginal cost and average total cost of producing a pair of sandals are constant and equal to $10 per pair. In addition, the marginal cost of distributing and selling a pair of sandals is constant at $40 per pair and equal to the average total cost of distribution. Price Quantity (pairs of sandals per month) (dollars per pair of sandals) $100 200 $90 400 $80 600 $70 800 $60 1,000 $50 1,200 $40 1,400 Suppose you sell your sandals to retail distributors in a perfectly competitive market. Your wholesale quantity will be pairs of sandals and your wholesale price will be $ per pair. Your wholesale economic profit will be $. The retail quantity will be pairs of sandals and the retail price will be $ per pair. The total economic profit of all the distributors will be $
Your company produces a unique style of sandals. The table shows price/quantity combinations from the retail demand curve for your sandals. This demand curve for your shoes is linear. Your marginal cost and average total cost of producing a pair of sandals are constant and equal to $10 per pair. In addition, the marginal cost of distributing and selling a pair of sandals is constant at $40 per pair and equal to the average total cost of distribution. Price Quantity (pairs of sandals per month) (dollars per pair of sandals) $100 200 $90 400 $80 600 $70 800 $60 1,000 $50 1,200 $40 1,400 Suppose you sell your sandals to retail distributors in a perfectly competitive market. Your wholesale quantity will be pairs of sandals and your wholesale price will be $ per pair. Your wholesale economic profit will be $. The retail quantity will be pairs of sandals and the retail price will be $ per pair. The total economic profit of all the distributors will be $
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter16: Government Regulation
Section: Chapter Questions
Problem 6E
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Your company produces a unique style of sandals. The table shows
$10
per pair. In addition, the marginal cost of distributing and selling a pair of sandals is constant at
$40
per pair and equal to the average total cost of distribution.
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