How much to charge to maximize profits

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Reference no: EM133094403

Activity - Given their goal, what is the optimal choice for each player? Andrea's Day Spa began to offer a relaxing aromatherapy treatment.

The firm asks you how much to charge to maximize profits. The demand curve for the treatments is given by the first two columns in the following table; its total costs are given in the third column. For each level of output, calculate total revenue, marginal revenue, average cost, and marginal cost. What is the profit-maximizing level of output for the treatments and how much will the firm earn in profits?

Price	Quantity	TC
$25.00	0	$130
$24.00	10	$275
$23.00	20	$435
$22.50	30	$610
$22.00	40	$800
$21.60	50	$1,005
$21.20	60	$1,225

Reference no: EM133094403

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