Question

Notes Ask Your Tea Coastal Soda Sales has been granted exclusive market rights to the upcoming Beaufort Seafood Festival. This means that during the festival Coastal will have a monopoly, and it is anxious to take advantage of this position in its pricing strategy. The daily demand function is -2-0.0004 and the dally total cost function is ax)-800 + 02x + 0.000!x2 where x is the number of units. (a) Determine Coastal's total revenue and profit functions. R(x) (b) What proht-maximizing price per soda should Coastal charge? per soda How many sodas per day would it expect to sell at this price? sodes per day What would be the daily profies? per day (c) If the festival organigers wanted to set an economically efficient price of $1.25 per soda, how would this change the results from part (b)? (Round your answer for daily profts to the nearest cent.) sodas per day it would expect to sel daily profs sodas per day per day Would Coastal be willing to provide sodas for the festival at this regulated price? Why or why not? Yes, Coastal would still provide sodas, because the profits would be significantly greater Yes, Coastal would still provide sodas, because the profits would be almost the same No, Coastal would no longer provide sodas, because the profits would be significantly ess

Answer 1

Yes, Coastal would still provide sodas, because the profit would be significantly greater.

2-0, 0001-X Ce%) = &00 +0.2x+0.0001 c2 even Rtx) 2. → 1.8- 1800 soda per da 2. aj 2 O (C.) Nowi It would expected to sell [18:15] sodas Pa day as e da 817.19