If Fernando can produce pizzas at a constant cost of $5 per pizza, how many pizzas does he produce, what price does he charge, and how much profit does he make?

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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a. If Fernando can produce pizzas at a constant cost of $5 per pizza, how many pizzas does he produce, what price does he charge, and how much profit does he make?
Transcribed Image Text:a. If Fernando can produce pizzas at a constant cost of $5 per pizza, how many pizzas does he produce, what price does he charge, and how much profit does he make?
### Demand for Fernando's Pizzas

Fernando has a monopoly on pizza sales in North Key Largo, Florida. Below is a table showing the relationship between the price of Fernando's pizzas and the quantity demanded by consumers.

#### Table: Price and Quantity Demanded

| Price | Quantity Demanded |
|-------|-------------------|
| $30   | 0                 |
| $25   | 1                 |
| $20   | 2                 |
| $15   | 3                 |
| $10   | 4                 |
| $5    | 5                 |
| $0    | 6                 |

#### Explanation:

- The table illustrates a typical downward-sloping demand curve. As the price of a pizza decreases, the quantity demanded increases.
- At the highest price point of $30, no pizzas are demanded. At a price of $0, the maximum quantity demanded is 6 pizzas.
- This data can be used to analyze consumer behavior, elasticity of demand, and pricing strategies in a monopolistic market.
Transcribed Image Text:### Demand for Fernando's Pizzas Fernando has a monopoly on pizza sales in North Key Largo, Florida. Below is a table showing the relationship between the price of Fernando's pizzas and the quantity demanded by consumers. #### Table: Price and Quantity Demanded | Price | Quantity Demanded | |-------|-------------------| | $30 | 0 | | $25 | 1 | | $20 | 2 | | $15 | 3 | | $10 | 4 | | $5 | 5 | | $0 | 6 | #### Explanation: - The table illustrates a typical downward-sloping demand curve. As the price of a pizza decreases, the quantity demanded increases. - At the highest price point of $30, no pizzas are demanded. At a price of $0, the maximum quantity demanded is 6 pizzas. - This data can be used to analyze consumer behavior, elasticity of demand, and pricing strategies in a monopolistic market.
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