Economics

Maximizing Revenue

From the scenario, assuming Katrina’s Candies is operating in the monopolistically competitive market structure and faces the following weekly demand and short-run cost functions

Algebraically, determine what price Katrina’s Candies should charge in order for the company to maximize profit in the short run. Determine the quantity that would be produced at this price and the maximum profit possible.

Supply and Demand

From the scenario for Katrina’s Candies, examine the key factors affecting the demand for and the supply of a good in general and Katrina’s Candies specifically. Distinguish between a change in demand and a change in the quantity demanded (movement along the demand curve). Propose two (2) methods in which organizations that provide the good may utilize this information.

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