Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer and show the calculations also. Thanks Tea Kandy (TK) is the only a bubble tea store in Ljubljana. The local demand for bubble

image text in transcribed

please answer and show the calculations also. Thanks

image text in transcribed
Tea Kandy (TK) is the only a bubble tea store in Ljubljana. The local demand for bubble tea is given by QD = 1200 - 12P. TK's total cost is TC = Q2/12 - 40Q + 3000. (a) Suppose TK wants to maximise profits, what would be the price they would choose for a serving of bubble tea? Show your work. [4 marks] (b) The owners of TK decided they wanted to support drinking of bubble tea. How many serving of bubble tea would TK want to eliminate deadweight loss? [3 marks] (c) One of the employees at TK, who obtained an HD in ECON1001 a few years ago, proposed a third solution: setting a price such that revenue is maximised. Which was the price he proposed? [3 marks]

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Macroeconomics

Authors: Michael Parkin

10th Edition

013485330X, 978-0134853307

More Books

Students also viewed these Economics questions

Question

=+9. What are points of difference and why are they important?

Answered: 1 week ago

Question

3. What is my goal?

Answered: 1 week ago

Question

2. I try to be as logical as possible

Answered: 1 week ago