Answered: Your company produces a unique style of…

Microeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506893

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter11: Price-searcher Markets With High Entry Barriers

Section: Chapter Questions

Problem 14CQ

See similar textbooks

Related questions

Question

Your company produces a unique style of sandals. The table shows price/quantity combinations from the retail demand curve for your sandals. This demand curve for your shoes is linear. Your marginal cost and average total cost of producing a pair of sandals are constant and equal to

$10

per pair. In addition, the marginal cost of distributing and selling a pair of sandals is constant at

$40

per pair and equal to the average total cost of distribution.

Your company produces a unique style of sandals. The table shows price/quantity combinations from the retail demand curve for your sandals. This
demand curve for your shoes is linear. Your marginal cost and average total cost of producing a pair of sandals are constant and equal to $10 per pair. In
addition, the marginal cost of distributing and selling a pair of sandals is constant at $40 per pair and equal to the average total cost of distribution.
Price
Quantity
(pairs of sandals per month)
(dollars per pair of sandals)
$100
200
$90
400
$80
600
$70
800
$60
1,000
$50
1,200
$40
1,400
Suppose you sell your sandals to retail distributors in a perfectly competitive market.
Your wholesale
uantity will be
pairs of sandals and your wholesale price will be $
per pair.
Your wholesale economic profit will be $
The retail quantity will be
pairs of sandals and the retail price will be $
per pair.
The total economic profit of all the distributors will be $
Suppose you sell your sandals to a monopoly retail distributor.
Your wholesale quantity will be
pairs of sandals and your wholesale price will be $
Your wholesale economic profit will be $.
The retail quantity will be
pairs of sandals and the retail price will be $
per pair.
The total economic profit of your distributor will be $

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions