Price and cost (dollars per item)1412108642MR051015MC = ATC2520Quantity (millions)The figure above shows the demand for items from a warehouse club. All of the people whoshop at the warehouse club have the same demand. If the managers set a single price, sothat all customers pay the same price for every item they buy, the firm makes an economicprofit ofand if the managers use two-part pricing, the firm makes an economicprofit of$40 million; $60 million$60 million; $80 million$0; $80 million$40 million; $80 million

Step 1: Analyse the given diagram Step 2:Understand what is asked and connect it to given data Step…

Answered: Price and cost (dollars per item) 14 12…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Please explain correctly and clearly.
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Could companies implementing two pricing strategies at the same time? For instance, cost based pricing and competition based pricing
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