Drybar, a hair salon, faces a weekly demand for blowouts equal to qp = 1120 - 20P. The salon has weekly total cost of TC(q)=0.05q² + 20q + 500. (a) The minimum efficient scale (i.e., the quantity that achieves minimum average cost) is___ --- (b) The weekly marginal revenue for this salon is MR =. --- (c) This salon's profit maximizing level of output is_, price is_ (d) When the salon produces at the profit maximizing level, the consumer surplus is__, the producer surplus is_. (e) Suppose the salon can do first-degree price discrimination, consumer surplus is__and producer surplus is.
Drybar, a hair salon, faces a weekly demand for blowouts equal to qp = 1120 - 20P. The salon has weekly total cost of TC(q)=0.05q² + 20q + 500. (a) The minimum efficient scale (i.e., the quantity that achieves minimum average cost) is___ --- (b) The weekly marginal revenue for this salon is MR =. --- (c) This salon's profit maximizing level of output is_, price is_ (d) When the salon produces at the profit maximizing level, the consumer surplus is__, the producer surplus is_. (e) Suppose the salon can do first-degree price discrimination, consumer surplus is__and producer surplus is.
Chapter11: Profit Maximization
Section: Chapter Questions
Problem 11.4P
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![Drybar, a hair salon, faces a weekly demand for blowouts equal to qp = 1120 - 20P.
The salon has weekly total cost of TC(q)=0.05q² + 20q + 500.
(a) The minimum efficient scale (i.e., the quantity that achieves minimum average cost) is__.
(b) The weekly marginal revenue for this salon is MR
(c) This salon's profit maximizing level of output is__, price is__
(d) When the salon produces at the profit maximizing level, the consumer surplus is__, the
producer surplus is__.
(e) Suppose the salon can do first-degree price discrimination, consumer surplus is__and
producer surplus is_-](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcef6525f-37a8-4004-8716-bcba7bc14bbc%2F699d7699-ff0f-40df-a545-16d97dde1d1e%2Fqcwc11hi_processed.png&w=3840&q=75)
Transcribed Image Text:Drybar, a hair salon, faces a weekly demand for blowouts equal to qp = 1120 - 20P.
The salon has weekly total cost of TC(q)=0.05q² + 20q + 500.
(a) The minimum efficient scale (i.e., the quantity that achieves minimum average cost) is__.
(b) The weekly marginal revenue for this salon is MR
(c) This salon's profit maximizing level of output is__, price is__
(d) When the salon produces at the profit maximizing level, the consumer surplus is__, the
producer surplus is__.
(e) Suppose the salon can do first-degree price discrimination, consumer surplus is__and
producer surplus is_-
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