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A bicycle manufacturing company can produce electric bikes at an incremental cost of $400 each. The company's market research has identified a logit price-response function
A bicycle manufacturing company can produce electric bikes at an incremental cost of $400 each. The company's market research has identified a logit price-response function for ( ) the upcoming month's sales, where () = ( ) , characterized by parameters D = 5,000, b = 0.005. The market research team has also identified that the demand for the electric bikes is 2,500 when price is $1,400. a. At what price should the company set its electric bikes to maximize net contribution? (10 points) b. Based on this optimal pricing strategy, how many electric bikes is the company expected to sell in the month
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