Andrea’s Day Spa began to offer a relaxing aromatherapy treatment. The firm asks you how much to charge to maximize profits. The first two columns in the table below provide the price and quantity for the demand curve for treatments. The fifth column shows its total costs. Complete the table. What is the profit-maximizing level of output for the treatments and how much will the firm earn in profits? Price Quantity Total Revenue Marginal Revenue Total Cost Marginal Cost $25 0 $0 N/A $130 N/A $24 10 $275 $23 20 $435 $22.50 30 $610 $22 40 $800 $21.60 50 $1005 $21.20 60 $1225
Andrea’s Day Spa began to offer a relaxing aromatherapy treatment. The firm asks you how much to charge to maximize profits. The first two columns in the table below provide the price and quantity for the demand curve for treatments. The fifth column shows its total costs. Complete the table. What is the profit-maximizing level of output for the treatments and how much will the firm earn in profits? Price Quantity Total Revenue Marginal Revenue Total Cost Marginal Cost $25 0 $0 N/A $130 N/A $24 10 $275 $23 20 $435 $22.50 30 $610 $22 40 $800 $21.60 50 $1005 $21.20 60 $1225
Chapter11: The Market For Pharmaceuticals
Section: Chapter Questions
Problem 1QAP
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Question
Andrea’s Day Spa began to offer a relaxing aromatherapy treatment. The firm asks you how much to charge to maximize profits. The first two columns in the table below provide the price and quantity for the demand curve for treatments. The fifth column shows its total costs. Complete the table. What is the profit-maximizing level of output for the treatments and how much will the firm earn in profits?
Price |
Quantity |
Total Revenue |
Marginal Revenue |
Total Cost |
Marginal Cost |
$25 |
0 |
$0 |
N/A |
$130 |
N/A |
$24 |
10 |
|
|
$275 |
|
$23 |
20 |
|
|
$435 |
|
$22.50 |
30 |
|
|
$610 |
|
$22 |
40 |
|
|
$800 |
|
$21.60 |
50 |
|
|
$1005 |
|
$21.20 |
60 |
|
|
$1225 |
|
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