Question
Consider a small town where there is only one company producing laptops. There are 6 potential customers of laptops, labelled as Customer A to Customer
Consider a small town where there is only one company producing laptops. There are 6 potential customers of laptops, labelled as Customer A to Customer F, respectively. The table below shows the willingness to pay for laptops by each customer, and the marginal cost of various quantities of laptops produced by the company. It is given that the company has a fixed cost of $800. Assume that the company knows each customer's willingness to pay for laptops. If the law requires the same price to be charged to all customers for the same product, employ the cost-benefit concept to determine the optimal quantity and price, and the profit of the company. How will your answers be affected if the company can charge different prices to different customers?
Customer Willingness to Pay ($) Quantity Marginal Cost ($) A 1,000 200 B 900 300 800 400 D 700 500 E 610 600 F 520 700Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started