Joseph Owns the Only Ice Cream Shop in a Small

Essay

Joseph owns the only ice cream shop in a small town outside Mobile, Alabama. According to the accompanying table, which shows production and costs for Joseph's ice cream shop, answer the following questions: $\begin{array}{lllr}\text { Price }&\text { Quantity }&\text { Fixed Cost }&\text { Variable Cost }\\\$ 8 & 0 & \$ 3 & \$ 0 \\\$ 7 & 1 & \$ 3 & \$ 2 \\\$ 6 & 2 & \$ 3 & \$ 4 \\\$ 5 & 3 & \$ 3 & \$ 7 \\\$ 4 & 4 & \$ 3 & \$ 12 \\\$ 3 & 5 & \$ 3 & \$ 20\end{array}$
a. By using the profit-maximizing rule, what is the quantity Joseph should produce to maximize his profits?
b. By using the profit-maximizing rule, what is the price Joseph should set to maximize his profits?
c. At the price and quantity you found, what is the profit Joseph makes?