Drybar, a hair salon, faces a weekly demand for blowouts equal to qp = 1120 - 20P. The salon has weekly total cost of TC(q)=0.05q² + 20q + 500. (a) The minimum efficient scale (i.e., the quantity that achieves minimum average cost) is___ --- (b) The weekly marginal revenue for this salon is MR =. --- (c) This salon's profit maximizing level of output is_, price is_ (d) When the salon produces at the profit maximizing level, the consumer surplus is__, the producer surplus is_. (e) Suppose the salon can do first-degree price discrimination, consumer surplus is__and producer surplus is.

Drybar, a hair salon, faces a weekly demand for blowouts equal to qp = 1120 - 20P. The salon has weekly total cost of TC(q)=0.05q² + 20q + 500. (a) The minimum efficient scale (i.e., the quantity that achieves minimum average cost) is___ --- (b) The weekly marginal revenue for this salon is MR =. --- (c) This salon's profit maximizing level of output is_, price is_ (d) When the salon produces at the profit maximizing level, the consumer surplus is__, the producer surplus is_. (e) Suppose the salon can do first-degree price discrimination, consumer surplus is__and producer surplus is.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter11: Profit Maximization

Section: Chapter Questions

Problem 11.4P

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