Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Question
Chapter 7, Problem 1.6P
To determine
The profit of Apple.
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The following graph shows the daily demand curve for bippitybops in Denver.
Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve.
Note: You will not be graded on any changes made to this graph.
PRICE (Dollars per bippitybop)
240
220
200
180
160
140
120
100
80
8
60
40
20
0
mớ
H
+
0
9
18
27 36 45 54 63 72 81
QUANTITY (Bippitybops per day)
*
Demand
90
B
99
108
Total Revenue
(?)
Del's and Rodney's are two plumbing services in a gentrifying area of South East
London. Within the area they service, the two firms operate as a duopoly and
together serve one hundred percent of the available local market. One of their key
lines of business is visiting customer's homes to install a new shower rail. A student
project has been investigating the local plumbing business and has estimated the
following information for Del's and Rodney's:
Total demand for new shower rails per week is given by
P = 200 - 4Q
Where Q is total market demand and can be divided between Del's (qd) and
Rodney's (qr) such that
Q = qd + qr
Assuming that the marginal cost of serving an extra customer is £40 for each, and
that marginal revenue for Del is given by
MRd
2008qd - 4qr
And marginal revenue for Rodney is given by
MRr
Then
2008qr - 4qd
8
CONTINUED
Chapter 7 Solutions
Principles of Economics (12th Edition)
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