A manufacturer of a new patented product has found that he can sell 70 units a week to the customer if the price is $48. In error, the price was recently advertised at $78 and as a result, only 40 units were sold in a week. The manufacturers fixed costs of production are $1,710 a week and variable costs are $9 per unit. You are required to: a. Show the equation of the demand function linking price (P) to quantity demanded (X) assuming it to be a straight line is P = 118-x

A manufacturer of a new patented product has found that he can sell 70 units a week to the customer if the price is $48. In error, the price was recently advertised at $78 and as a result, only 40 units were sold in a week. The manufacturers fixed costs of production are $1,710 a week and variable costs are $9 per unit. You are required to: a. Show the equation of the demand function linking price (P) to quantity demanded (X) assuming it to be a straight line is P = 118-x

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter16: Labor Markets

Section: Chapter Questions

Problem 16.7P

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A manufacturer of a new patented product has found that he can sell 70 units a week to the customer if the price is $48. In error, the price was recently advertised at $78 and as a result only 40 units were sold in a week. The manufacturers fixed costs of production are $ 1710 a week and variable costs are $9 per unit. You are required to a) Show the equation of the demand function linking price (P) to quantity demanded (X) assuming it to be a straight line is P = 118-x
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