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Discussion #6: Ibrahim's Bananas 2 Suppose Ibrahim owns the only fruit stand in town. Each day Ibrahim brings a wagon with 200 pounds of bananas.

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Discussion #6: Ibrahim's Bananas 2 Suppose Ibrahim owns the only fruit stand in town. Each day Ibrahim brings a wagon with 200 pounds of bananas. He can sell all 200 pounds for a price of $1.50 per pound. If he brings two wagons of bananas per day (400 pounds total), he can still sell all of the bananas, but he'll have to lower his price to $1 per pound. Each pound of bananas costs Ibrahim a marginal cost of $.75 to produce. Use this information to answer the following: 1. What is the marginal revenue (per pound) for the second wagon full of bananas? 2. Is it more profitable for Ibrahim to bring 2 wagons of bananas each day or 17

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