QUESTION 9 Suppose there are 9 individual consumers who value a pen in the follo

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QUESTION 9 Suppose there are 9 individual consumers who value a pen in the following order ($0080,700, $6.00, s5.00, $5.00, $3 00, 52.00, $1.00). There are no fixed costs and your marginal cost of production of a pen is $2.00. Based on your answers to Q2, Q3, and Q4, what is the profit maximizing amount of sales? (Sales] QUESTION 10 Suppose there are 9 individual consumers who value a pen in the following order ($9.00, $8.00, $7.00, $6.00, $5.00, $5.00 $3.00, $2.00, $1.00). There are no fixed costs and your marginal cost of production of a pen is $2.00. Based on your answers to Q2, Q3, Q4, and Q5, what price should you charge to maximize your profit? [Price Provide your answers using two decimal places even if the decimal places are zeros

Explanation / Answer

Q9) Profit maximizing output is when MR=MC +2. This occurs at the quantity of 8 unit and price of 2.

Q10)The firm will maximize profits if it charges 2 dollars as it will be able to capture maximum surplus at this price.

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