Business, 12.08.2020 06:01, leopolesamoy

Lucinda has written a new novel and has chosen to self-publish. Her copyright ensures that no one can legally copy her novel. The table below shows the demand for Lucinda's novel and her costs of publishing. Demand, Costs, and Revenues for Lucinda's Book

Price (dollars) Quantity (books) Marginal Revenue (dollars) Marginal Cost (dollars) Average Total Cost (dollars)
$45 0 --- ---
40 4,000 $40.00 $5.00 $6.25
35 8, 000 30 3.75 5
30 12,000 20 5 5
25 16,000 10 10 6.25
20 20,000 0 18.75 8.75
15 24,000 -10 .00 31.25 12.5

Required:
a. How many books should Lucinda publish in order to maximize profits?
b. What price should Lucinda charge for her book in order to maximize profits?
c. How much profit will Lucinda's book generate if she produces the profit-maximizing quantity and charges the profit-maximizing price?
d. Identify the profit-maximizing price and quantity and show the amount of profit earned.

Instructions: Use the tool provided 'Profit Max' to identify the profit-maximizing price and quantity combination. Then use the shading tool provided 'Profit' to illustrate the amount of profit earned.

Answers: 3

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Lucinda has written a new novel and has chosen to self-publish. Her copyright ensures that no one ca...