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A manufacturer is planning to introduce a new model of headphones. He estimates fixed cost of the production to be $2800 and the variable cost
A manufacturer is planning to introduce a new model of headphones. He estimates fixed cost of the production to be $2800 and the variable cost of $32 per unit. He believes that it would be possible to sell 240 units at the price of $70 but each one dollar increase in the price will result in the loss of four potential customers. At what price should the manufacturer sell the headphones to maximize profit? How many units should he produce and what will be his total profit?
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