Suppose that Karina is running a tattoo parlor with two types of customers. The first type is willing to pay $80 for a tattoo, while the second type is willing to pay just $40 for a tattoo. The ink for a tattoo costs $10. Customers will only buy one tattoo each. If Karina can only set a single price, what price will she set? a. 80 b. 40 c. 70 d. 30

Suppose that Karina is running a tattoo parlor with two types of customers. The first type is willing to pay $80 for a tattoo, while the second type is willing to pay just $40 for a tattoo. The ink for a tattoo costs $10. Customers will only buy one tattoo each. If Karina can only set a single price, what price will she set? a. 80 b. 40 c. 70 d. 30

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter21: Demand: Consumer Choic

Section: Chapter Questions

Problem 16E

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Juanita is deciding whether to buy a suit that she wants, as well as where to buy it. Three stores carry the same suit, but it is more convenient for Juanita to get to some stores than others. For example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of $102 for the suit: Store Local Department Store Across Town Neighboring City Store Local Department store Juanita makes $42 an hour at work. She has to take time off work to purchase her suit, so each hour away from work costs her $42 in lost income. Assume that returning to work takes Juanita the same amount of time as getting to a store and that it takes her 30 minutes to shop. As you answer the following questions, ignore the cost of gasoline and depreciation of her car when traveling. (Just enter the whole dollar number, no units and no cents) Across Town Travel Time Each Way (Minutes) 15 30 60 Neighboring city Price of a Suit (Dollars per suit) 102 Opportunity cost of time…
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