Slick Shades has a constant marginal cost of production equal to $40 and the distributors have a constant marginal cost of distribution equal to $20. If Slick Shades is producing the profit-maximizing number of sunglasses (in hundreds), what is the profit-maximizing wholesale price?
The figure above shows the wholesale demand and marginal revenue curves for Slick Shades Sunglasses, a sunglasses firm with market power. Slick Shades Sunglasses has a constant marginal cost of production and it sells to perfectly competitive independent retail distributors that have a constant marginal cost of distribution.
A) $110
B) $120
C) $140
D) $130
B) $120
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Marginal revenue equals 0 when:
A) total revenue is increasing. B) total revenue is at its maximum. C) total revenue is decreasing. D) none of the above; marginal revenue is always positive.
Use the following statements to answer this question: I. The income-consumption curve for perfect complements is a straight line. II. The price-consumption curve for perfect complements is a straight line
A) I and II are true. B) I is true and II is false. C) II is true and I is false. D) I and II are false.