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Q. Overhead at the water cooler the demand also cost estimate which were provided at the meeting are very useful(Q=90-6.5P also TC=150+3.5Q) unfortunately Illustrate what we did not realize at the time was which our fixed cost were underestimate by at least 30 percent this means which we will have to ad immediately our price upward by at least 30 percent to cover the add fixed cost in any case there is no way in the world which we can survive by charging less than $9 for our product You're provided with the subsequent additional information: The price which maximizes short run profit is $8.67 also quantity sold is 33.625 units. The AVC is $3.50, AC before the 30percent (%) increase in fixed costs is $7.96, AC after the 30percent (%) increase in fixed costs is $9.30. Answer the following:Now, do you agree with speaker to increase the price of the company's product to more than $9? Elucidate.
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