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Roland Incorporated manufactures and sells portable hair dryers. If the price of a hair dryer is $ 191.00, then the company sells 125 hair dryers
Roland Incorporated manufactures and sells portable hair dryers. If the price of a hair dryer is $ 191.00, then the company sells 125 hair dryers per week, and the elasticity of demand is -1.46. Assume that the demand function is differentiable and that the only time the company sells exactly 125 hair dryers per week is when the price of a hair dryer is $ 191.00. Given this situation, which of the following do you know MUST be true? (Hint: Recall that marginal revenue is the derivative of revenue with respect to quantity.] o a) The marginal revenue is positive when Roland sells 125 driers per week. o a) The marginal revenue is positive when Roland sells 125 driers per week. o b) The marginal profit is negative when Roland sells 125 driers per week. The marginal profit is positive when Roland sells 125 driers per week. o d) The marginal revenue is negative when Roland sells 125 driers per week
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