Question
The American Bakers Association reports that annual sales of bakery goods last year rose 15 percent, driven by a 50 percent increase in the demand
The American Bakers Association reports that annual sales of bakery goods last year rose 15 percent, driven by a 50 percent increase in the demand for bran muffins. Most of the increase was attributed to a report that diets rich in bran help prevent certain types of cancer. You are the manager of a bakery that produces and packages gourmet bran muffins, and you currently sell bran muffins in packages of three. However, as a result of this new report, a typical consumers inverse demand for your bran muffins is now P = 9 - 0.5Q. If your cost of producing bran muffins is C(Q) = 4.5Q, determine the optimal number of bran muffins to sell in a single package and the optimal package price.
Optimal package size:
Optimal package price: $
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