If Slick Shades has a constant marginal cost of production equal to $40 and the distributors have a constant marginal cost of distribution equal to $20, what is the profit-maximizing number of sunglasses (in hundreds) for Slick Shades to produce?
The figure above shows the wholesale demand and marginal revenue curves for Slick Shades Sunglasses, a sunglasses firm with market power. Slick Shades Sunglasses has a constant marginal cost of production and it sells to perfectly competitive independent retail distributors that have a constant marginal cost of distribution.
A) 90
B) 80
C) 50
D) 70
B) 80
You might also like to view...
Free trade agreements between the United States and Canada started with the auto industry in the year 1965
Indicate whether the statement is true or false
Supply-siders are generally critical of government intervention and regulation, since they believe regulations can be costly impediments to economic growth
a. True b. False Indicate whether the statement is true or false
Compared to barter, money __________ transaction costs, making transactions __________ time-consuming
A) increases; more B) increases; less C) reduces; more D) reduces; less
A drought has destroyed orange crops in California. The drought has caused
A. a shortage because people cannot obtain as many oranges as they wish to buy at the pre-drought price. B. scarcity because there are less oranges now than people want. C. a shortage because orange growers will have less income. D. scarcity because people have to switch to oranges grown in Florida.