Jamie asks how you will be able to determine the impact of advertising. You explain that Hannah, a senior accountant, has estimated the effect of one unit of advertising on the firm's demand and marginal revenue. You remind Jamie that the average total cost and marginal cost are the gross values and do not consider advertising cost, so they do not change.

Then you show Jamie the following graph that Hannah provided. It reflects one unit of advertising:

Price and Cost (dollars per unit) $260 $240 $220 $200 $180 $160 $140 $120 $100 $80 $60 MC = LACGROSS $40 $20 SO D -$20 0 10 20 30 40 50 60 70 80 90 100 110 120 -$40 MR Quantity (units per day)