. In Robertsville, Missouri, there is only one newspaper, the Daily Gossip. The

Question

. In Robertsville, Missouri, there is only one newspaper, the Daily Gossip. The demand for the newspaper depends on the price and the amount of scandal reported. The demand function is q = 15s 1 2 p3, where q is the number of issues sold per day, s is the number of column inches of scandal reported in the paper, and the p is the price. It costs money to print and deliver the paper. These cost $0.10 per copy (so the marginal cost is $0.10) and it is independent of the amount of scandal reported in the paper. (a) Find the profit-maximizing price for a copy of the Daily Gossip. Call it p. (b) If the Daily Gossip charges p and prints 100 column inches of scandal, how many copies would it sell? (c) Scandals are not a scarce commodity in Robertsville. However, it takes resources to write, edit, and print stories of scandal. The cost of reporting s column-inches of scandal is $10s. These costs are independent of the number of papers sold. What is the profitmaximizing amount of scandal?

Explanation / Answer

. In Robertsville, Missouri, there is only one newspaper, the Daily Gossip. The

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.