Solved

Suppose a Typical Consumer's Inverse Demand Function for Bottled Water

Question 125

Essay

Suppose a typical consumer's inverse demand function for bottled water at a resort area where one firm owns all the rights to a local spring is given by P = 15 - 3Q.The marginal cost for gathering and bottling the water is $3 per gallon.Find the optimal number of bottles to package together for sale and the profit-maximizing price to charge for the package.Show the solution graphically.
Figure 11-2
Suppose a typical consumer's inverse demand function for bottled water at a resort area where one firm owns all the rights to a local spring is given by P = 15 - 3Q.The marginal cost for gathering and bottling the water is $3 per gallon.Find the optimal number of bottles to package together for sale and the profit-maximizing price to charge for the package.Show the solution graphically. Figure 11-2

Correct Answer:

verifed

Verified

Each package should contain f...

View Answer

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions