Question
Take every possibly quantity that the managers might choose between 0 and 7,000 in units of 100. For each possible quantity, calculate the associated price
Take every possibly quantity that the managers might choose between 0 and 7,000 in units of 100. For each possible quantity, calculate the associated price the managers would need to charge, the revenue they would earn, and the total costs. You can then calculate profits for each level of quantity. Highlight the cell that contains the highest value of profit.
How do I complete the following table: for Total Costs, Profits and Marginal Revenue
Quantity Price Revenue
100 $39,750 $3,975,000
200 $39,500 $7,900,000
300 $39,250 $11,775,000
400 $39,000 $15,600,000
500 $38,750 $19,375,000
Suppose that managers at Honda are deciding how to price the new Honda Accord.
The managers estimate that their total costs increase by $20,000 for each car they produce.
They also estimate the demand curve they face; it is described by the equation:
Q = -0.4 P + 16,000, where Q represents the quantity of Honda Accords they will sell and P represents the price they charge in US dollars.
We can re-write that demand curve as: P = 40,000 - 2.5 Q.
Step 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