H5. At the consulting agency, they recognize that water/wastewater customers fallunder different segments. Each segment supports different characteristics thatinfluence the services accessible to them and the price for these services. Forsimplification, these segments have been grouped into two categories: commercialand residential customers. Each segment has different rates. The commercialcustomers have a demand curve of d₁ = 3,500 - 125p₁. While residential customershave a demand curve of d2 = 8,000 - 50p2. The water/wastewater operation cost isc = $2 per unit or gallon.What is the total profit at differential pricing?$257,162$296,537$333,175$344,325

Profit maximizing conditionMarginal revenue (MR)=Marginal Cost (MC)

At the consulting agency, they recognize that water/wastewater customers fall under different segments. Each segment supports different characteristics that influence the services accessible to them and the price for these services. For simplification, these segments have been grouped into two categories: commercia and residential customers. Each segment has different rates. The commercial customers have a demand curve of d₁ = 3,500 - 125p₁. While residential customer have a demand curve of d2 = 8,000 - 50p2. The water/wastewater operation cost i c = $2 per unit or gallon. What is the total profit at differential pricing? $257,162 $296,537 $333,175 $344,325

At the consulting agency, they recognize that water/wastewater customers fall under different segments. Each segment supports different characteristics that influence the services accessible to them and the price for these services. For simplification, these segments have been grouped into two categories: commercia and residential customers. Each segment has different rates. The commercial customers have a demand curve of d₁ = 3,500 - 125p₁. While residential customer have a demand curve of d2 = 8,000 - 50p2. The water/wastewater operation cost i c = $2 per unit or gallon. What is the total profit at differential pricing? $257,162 $296,537 $333,175 $344,325

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

H5.

At the consulting agency, they recognize that water/wastewater customers fall
under different segments. Each segment supports different characteristics that
influence the services accessible to them and the price for these services. For
simplification, these segments have been grouped into two categories: commercial
and residential customers. Each segment has different rates. The commercial
customers have a demand curve of d₁ = 3,500 - 125p₁. While residential customers
have a demand curve of d2 = 8,000 - 50p2. The water/wastewater operation cost is
c = $2 per unit or gallon.
What is the total profit at differential pricing?
$257,162
$296,537
$333,175
$344,325

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